Michael Tamblyn

The moving parties sought leave to appeal the decision of Kimmel J. dated June 18, 2024.

The Divisional Court dismissed the motion for leave to appeal and awarded costs of $5,000 to the responding party.

This motion, part of a larger reference concerning the Nobu Residences condominium complex, addressed the application of the transition provisions in section 87.3 of the Construction Act.

The core issue was whether the former Construction Lien Act (CLA) or the current Construction Act applied to the improvement and associated liens, which directly impacted lien timeliness.

The owner, 35 Mercer Limited, the contractor, Urban Integrated Group Inc., and a lien claimant, Brunco Insulation Ltd., argued for the application of the CLA, while Desco Plumbing and Heating Supply Inc. contended the current Construction Act should apply.

The court found that the CLA continues to apply to the improvement and all liens arising from it, based on evidence that a procurement process for the improvement commenced before July 1, 2018.

The court rejected arguments that the owner's affidavit was deficient, that ex parte vacating orders were binding, that the onus to provide transition dates was "murky" or that project delays like the COVID-19 pandemic should influence the application of section 87.3.

The court issued a costs endorsement following motions for a stay of proceedings, a certificate of pending litigation (CPL), and the appointment of an arbitrator.

The defendants had sought a stay, which was granted permanently for one defendant and temporarily for the other, while the plaintiff successfully obtained a CPL.

Finding divided success on the stay motion, the court ordered each party to bear its own costs for that motion.

However, as the plaintiff was successful on the CPL motion, the court awarded the plaintiff partial indemnity costs fixed at $35,000 all-inclusive.

The appellants, a group of subcontractors and a bank, appealed an application judge's decision that rescission of surety bonds might be possible even if it affects innocent third parties.

The bonds were issued by Zurich Insurance Company Ltd. for a large construction project, but Zurich later discovered alleged fraudulent misrepresentations and collusion that induced it to issue the bonds.

The appellants sought a declaration that rescission was unavailable as a matter of law due to the involvement of innocent third parties.

The Court of Appeal dismissed the appeal, affirming that prejudice to third parties is not an absolute bar to rescission, especially in cases of fraudulent misrepresentation, and that such a determination requires a full factual record at trial.

The defendant brought a motion for leave to appeal the order of Myers J. The Divisional Court granted the motion for leave to appeal and awarded costs of $5,000 to the moving party.

The defendant brought a motion for leave to appeal the order of Myers J. The Divisional Court granted the motion for leave to appeal and awarded costs of $5,000 to the moving party.

The applicants, a syndicate of lenders and various construction trades, sought declarations that the respondent surety could not rescind performance and payment bonds issued for a hospital redevelopment project.

The surety had discovered alleged fraud and collusion in the procurement process and commenced a separate action for rescission.

The applicants argued they were innocent third parties whose rights under the bonds could not be defeated by the alleged fraud of the principals.

The court dismissed the applications, finding that the applicants' rights were derivative of the principals and that rescission remained a possible equitable remedy that must be determined on a full factual record at trial.

The plaintiff brought a motion to certify a class action on behalf of purchasers of hotel condominium units in the Trump International Hotel and Tower Toronto who sought rescission of their purchase agreements and the return of their deposits due to alleged misrepresentations.

The court found that the pleadings disclosed causes of action for negligent and fraudulent misrepresentation, and that the identifiable class, common issues, and preferable procedure criteria were met.

However, the court found a conflict of interest with the proposed class counsel, who also represented plaintiffs in individual actions.

The court conditionally certified the class action, giving the plaintiff 60 days to retain new class counsel, and consolidated a related action.

This case conference endorsement outlines procedural progress in a complex, multi-party construction litigation involving Carillion Construction Inc., the City of Toronto, and NORR Limited, among others.

The court addressed the schedule for executive discoveries, ruling that they must proceed as planned, contrary to the City's submission.

It also confirmed the mediation schedule for March-April 2019, involving various claimants and insurers.

Further directions were given regarding documentary production by subcontractors and the City's amended third-party claim against Metrolinx, setting deadlines for Metrolinx's response or motion.

The moving party sought the production of files held by a non-party law firm.

The responding party objected to producing a subset of the files relating to his corporation, claiming they were irrelevant and subject to lawyer-client privilege.

The Master found that the responding party's review of the files was insufficiently thorough and that the files likely contained relevant, non-privileged documents.

The Master ordered the responding party to disclose all documents in the remaining files in a supplementary affidavit of documents, properly categorizing them into privileged and non-privileged schedules.

The Estate of Frank Calderone brought a motion seeking leave to amend its crossclaim against Joseph Calderone to introduce new allegations of fraud and fraudulent concealment related to a family business syndicate (CBS).

The court dismissed the motion, finding that the new claims were statute-barred under the Limitations Act, 2002, as the Estate failed to exercise reasonable diligence to discover the claims by December 2011.

The court also addressed ancillary requests, granting partial production of documents from PricewaterhouseCoopers LLP, adjourning the request for documents from McMillan LLP, granting leave to examine non-party David Young (a lawyer), and ruling on various refusals from Joseph Calderone's examination for discovery.

The action was assigned to case management.

The moving party brought a motion to quash an appeal from an application judge's decision setting aside an arbitrator's ruling that added subcontractors as parties to an arbitration.

The Court of Appeal granted the motion to quash, finding that the arbitrator's decision to add parties was a question of jurisdiction under the Arbitration Act, 1991.

Pursuant to section 17(9) of the Act, no appeal lies from a court's decision on a question of an arbitrator's jurisdiction.

Following a judgment awarding the respondents their costs of the appeal on a partial indemnity scale, the court reviewed the parties' written submissions.

The court fixed the respondents' costs of the appeal at $45,000, inclusive of disbursements and all applicable taxes.

The respondent, a former equity partner of the appellant accounting firm, withdrew from the partnership to join a competitor.

The partnership agreement required a withdrawing partner to pay liquidated damages equal to two times their 'Permanent Capital'.

The appellants argued the permanent capital should be based on the partner's 'Anchor Capital' which included shareholder loans, while the respondent argued it was limited to the $10,000 fixed in his capital account following a capital conversion.

The trial judge agreed with the respondent, fixing liquidated damages at $20,000 and ordering the appellants to repay the respondent's shareholder loan and other entitlements.

The Court of Appeal upheld the trial judge's interpretation of the partnership agreement, finding no palpable and overriding error, but allowed the appeal in part to set aside a small award for management fees that lacked evidentiary support.

The appellants appealed a summary judgment ordering the release of a statutory holdback to the respondent subcontractor.

The appellants argued the respondent failed to provide required close-out documentation, including as-built drawings and an engineering certificate, and that the matter should have proceeded to trial.

The Court of Appeal dismissed the appeal, finding the application judge properly applied the summary judgment standard and correctly concluded the required documents had been provided.

The court ordered the immediate payout of the holdback funds and dismissed a motion to introduce fresh evidence.

The plaintiffs brought certification motions under the Class Proceedings Act, 1992 relating to falling balcony glass panels from three condominium developments in Toronto.

Owners and residents alleged negligence, nuisance, and breach of contract against developers, builders, and related entities after balconies were sealed and glass panels replaced following safety concerns.

The defendants consented to certification subject to three caveats regarding class definition wording, certification of an aggregate damages issue, and the viability of a collateral contract claim against a developer.

The court certified the actions as class proceedings, rejecting the proposed change to the class definition and permitting the collateral contract claim to proceed as a common issue.

However, the court declined to certify a proposed aggregate damages issue due to appellate authority interpreting s. 24(1)(c) of the Class Proceedings Act as prohibiting random sampling of class members to determine damages.

A former equity partner withdrew from an accounting partnership and joined a competing firm, triggering a liquidated damages clause requiring payment equal to two times the partner’s “permanent capital.” The dispute concerned whether shareholder loans made through a related corporation formed part of “permanent capital” under the partnership agreement.

The court interpreted the agreement according to its plain language and held that permanent capital was equivalent to the partner’s capital account in the partnership, which had been equalized to $10,000 and did not include shareholder loans.

The plaintiff was therefore liable for $20,000 in liquidated damages but was entitled to repayment of capital, profit share, shareholder loan amounts, and related payments.

Allegations of fiduciary misconduct and various counterclaims by the partnership, including claims for suppressed work‑in‑progress and loss of opportunity damages, were rejected.

The appellant appealed a judgment dismissing its request for rectification of a definition in an Agreement of Purchase and Sale based on mutual mistake.

The dispute centered on the definition of 'Gross Floor Area' (GFA) and whether it should be rectified to correspond with a site-specific by-law rather than the City of Toronto By-law specified in the agreement.

The Court of Appeal dismissed the appeal, finding no mutual mistake because the respondent clearly intended to use the City of Toronto By-law definition to determine any increase in GFA.

The appellant brought an appeal under the Construction Lien Act from a Master's reasons before the report was confirmed.

The court previously found it lacked jurisdiction to hear the appeal, as the proper procedure was a motion to oppose confirmation under Rule 54.09.

In this endorsement on costs, the court awarded partial indemnity costs to the respondents for the jurisdictional issue, noting the appeal was unnecessary as the Master had advised the parties of the proper forum.

The court fixed costs at $2,500 for the first respondent and $1,500 for the second respondent.

The appellant appealed a Master's decisions interpreting Minutes of Settlement in a construction lien action regarding roof repairs.

The Divisional Court held it lacked jurisdiction to hear the appeal under section 71(1) of the Construction Lien Act because the Master's report had not yet been confirmed.

In the alternative, reviewing the merits, the court found the Master correctly interpreted the settlement agreement's definition of 'Work' and made no palpable and overriding errors of fact.

The appeal was dismissed.