Court of Appeal for Ontario

Date: May 8, 2017

Docket: C62284

Judges: Strathy C.J.O., Weiler and Benotto JJ.A.

Between

St. Clair Pennyfeather

Plaintiff (Appellant/Respondent by way of cross-appeal)

and

Timminco Limited, Photon Consulting LLC, Rogol Energy Consulting LLC, Michael Rogol, Dr. Heinz Schimmelbusch, Robert Dietrich, René Boisvert, Arthur R. Spector, Jack L. Messman, John C. Fox, Michael D. Winfield, Mickey M. Yaksich, and John P. Walsh

Defendants (Respondents/Appellants by way of cross-appeal)

Proceeding under the Class Proceedings Act, 1992

Counsel

Won J. Kim, Michael C. Spencer and Aris Gyamfi, for the appellant/respondent by way of cross-appeal

Alan L.W. D'Silva and Daniel S. Murdoch, for the respondents/appellants by way of cross-appeal Timminco Limited, Dr. Heinz Schimmelbusch, Robert Dietrich, René Boisvert, Arthur R. Spector, Jack L. Messman, John C. Fox, Michael D. Winfield and Mickey M. Yaksich

Paul Le Vay, Brendan Van Niejenhuis and Carlo Di Carlo, for the respondents Photon Consulting LLC, Rogol Energy Consulting LLC and Michael Rogol

Emrys Davis, for the respondent John P. Walsh

Heard: January 25 and 26, 2017

On appeal from: the order of Justice Paul M. Perell of the Superior Court of Justice, dated May 12, 2016, with reasons reported at 2016 ONSC 3124.

Reasons for Decision

Strathy C.J.O.:

[1] Introduction

[1] The appellant's proposed securities class action is presumptively time-barred because it was not commenced within the three-year limitation period contained in s. 138.14 of the Ontario Securities Act, R.S.O. 1990, c. S.5 ("OSA").

[2] I say "presumptively", because the dispositive issue in this appeal is whether the motion judge erred in the exercise of his discretion in finding that the appellant failed to meet the test for nunc pro tunc relief, described by the Supreme Court of Canada in Canadian Imperial Bank of Commerce v. Green, 2015 SCC 60, [2015] 3 S.C.R. 801 ("Green (SCC)"). For the reasons below, I conclude the motion judge did not err and I would dismiss the appeal.

[3] For this reason, it is unnecessary to consider the respondents' cross-appeal, which asserts that nunc pro tunc relief is barred by the doctrines of res judicata, issue estoppel or abuse of process. I will, nevertheless, explain why I would uphold the motion judge's decision on that issue.

A. Background

(1) The OSA Cause of Action

[4] In this section I will begin by summarizing the statutory cause of action for misrepresentation in the secondary securities market, contained in Part XXIII.1 of the OSA. I will then describe this action and its progress through the courts, up to the present appeal. Finally, I will examine Green (SCC) in more detail.

[5] In the sections that follow, I will summarize the motion judge's reasons, the submissions of the parties on appeal and my analysis of the issues.

[6] A statutory cause of action for misrepresentation in the secondary securities market was introduced as Part XXIII.1 of the OSA by amendments effective December 31, 2005. A similar remedy was made available in the primary market by Part XXIII. Both causes of action were uniquely suited to class actions because the remedy was available whether or not an investor had actually relied on an alleged misrepresentation. It resolved the problem that had typically torpedoed common law misrepresentation class actions – namely, the need to prove individual reliance: see, for example, Bayens v. Kinross Gold Corporation, 2014 ONCA 901, 327 O.A.C. 156, application for leave to appeal to S.C.C. discontinued, [2015] S.C.C.A. No. 59.

[7] The history of the statutory remedy, and the policy goals underlying it, were discussed by Côté J. in Green (SCC), at paras. 63-69. She observed that the legislation struck a "delicate balance" between the interests of potential plaintiffs and those of public issuers of securities, including their short-term and long-term shareholders. This balance was achieved, in part, by a leave requirement – a judicial screening mechanism designed to weed out unmeritorious actions (sometimes called "strike suits") as early as possible in the litigation process.

[8] Section 138.8(1) provided that no action could be commenced without leave of the court. Leave would be granted where the court was satisfied that the action was brought in good faith and there was a reasonable possibility that the action would be resolved at trial in favour of the plaintiff.

[9] The three year limitation period was contained in s. 138.14. It, too, was part of the "delicate balance" struck by the legislation (per Côté J., at para. 101). It provided that, in the case of a misrepresentation in a document, no action could be commenced later than the earlier of three years after the date on which the document containing the misrepresentation was first released or six months after the issuance of a news release disclosing that leave had been granted to commence an action under s. 138.3 or under comparable legislation in another province in respect of the same misrepresentations.

[10] This new statutory cause of action opened up new possibilities for class actions and for the plaintiffs' class action bar. The practice developed that courts heard motions for certification and leave at the same time, based on common materials. If the case did not pass the certification hurdle, then the statutory remedy would be of little practical use and if it did not pass the leave hurdle under the OSA, a class action based on a cause of action for common law misrepresentation would likely be unworkable and the putative class action would likely fail the "preferable procedure" test on the certification motion.

[11] But a troublesome issue remained. It arose due to the interaction between the three-year limitation period in s. 138.14 of the OSA and s. 28(1) of the Class Proceedings Act, 1992, S.O. 1992, c. 6 ("CPA"). The latter provides that the limitation period applicable to a cause of action asserted in a class proceeding is suspended in favour of a class member on the commencement of the class proceeding.

[12] Did this mean that the three-year limitation period was interrupted, in favour of the representative plaintiff and all class members, by the commencement of a class proceeding, asserting the statutory remedy under s. 138.3 of the OSA and declaring an intention to seek leave to proceed with such an action?

[13] This question spawned considerable litigation, including two appeals to this court. In the first, involving this proceeding, three judges of this court determined that s. 28(1) of the CPA did not suspend the limitation period until leave was actually granted: Sharma v. Timminco Ltd., 2012 ONCA 107, 109 O.R. (3d) 569 ("Timminco #1"). Accordingly, the appellant's claim was presumptively time-barred. His application for leave to appeal to the Supreme Court of Canada was dismissed: [2012] S.C.C.A. No. 157. The result was that the appellant's class action was effectively at an end, at least insofar as it asserted the OSA cause of action.

[14] The second appeal to this court on the same issue was in Green v. Canadian Imperial Bank of Commerce, 2014 ONCA 90, 118 O.R. (3d) 641 ("Green (OCA)"). There, a five-judge panel of this court reversed Timminco #1, holding that the OSA limitation period was interrupted by the commencement of the class proceeding, regardless of when leave was actually granted.

[15] On December 4, 2015, the Supreme Court reversed this court's decision in Green (OCA). The Supreme Court held that the limitation period was only tolled by the commencement of an action asserting the statutory remedy after leave had been granted. It acknowledged the possibility that leave could be granted nunc pro tunc to the date of the filing of the leave motion. In fact, the claim in Green was preserved at least partly on that basis. Later in these reasons, I will explain how this result was achieved.

[16] Having described the statutory and jurisprudential context, I now turn to this action.

(2) The History of This Action

[17] In March 2007, Timminco announced that it had developed a proprietary process for the production of silicon suitable for use in solar panels and that it had secured long-term contracts with customers. The beginning of the class period is marked by the first alleged misrepresentation, a press release dated March 17, 2008, announcing Timminco's financial results for the fourth quarter of 2007 and for the year ended December 31, 2007.

[18] The price of Timminco's shares doubled between the date of the press release and November 11, 2008, the end of the class period, rising from about $17 to about $35. But "corrective disclosures" were made in November 2008, and the share price fell dramatically.

[19] The stock was ultimately de-listed by the Toronto Stock Exchange in February 2012, and the company went into protection under the Companies' Creditors Arrangement Act, R.S.C. 1985, c. C-36 ("CCAA").

[20] The statement of claim in this proceeding was filed on May 14, 2009 by Ravinder Sharma, a Timminco shareholder. He sought certification of a class action asserting a statutory claim for misrepresentation by Timminco and its consultants, Photon Consulting LLC ("Photon") and Rogol Energy Consulting LLC ("Rogol"), in public statements and disclosure documents between March 17, 2008, the date of the first press release and a conference call on May 29, 2008. He also asserted an intention to seek leave to proceed with the statutory cause of action under Part XXIII.1 of the OSA.

[21] Another law firm commenced a second action on behalf of a different Timminco shareholder in June of 2009. A "carriage dispute" took place between the two law firms as to which action should proceed. On October 29, 2009, the motion judge awarded carriage to the appellant's counsel in this action.

[22] As I will describe below, for the next 15 months, the appellant's counsel focused on attempting to settle the action, probably due to Timminco's deteriorating financial condition. Little was done to advance the proposed class action. Meanwhile, however, the limitations clock was potentially ticking on the OSA cause of action.

[23] On January 31, 2011, Justice Rady of the Superior Court of Justice released a decision in Nor-Dor Developments Ltd. v. Redline Communications Group Inc., 2011 ONSC 591. In that case, the plaintiff had commenced a class action, stating an intention to assert a claim for secondary market misrepresentation under Part XXIII.1 of the OSA. While the plaintiff took the position that the limitation period had been tolled by the commencement of the action, it sought permission to file the proposed Part XXIII.1 statement of claim before the leave motion was adjudicated, because it was concerned that the limitation period might expire before the leave motion could be heard.

[24] Justice Rady held that she had no jurisdiction to grant this form of substantive relief, which essentially asked for a declaration that the limitation period was tolled even before the court had granted leave. She found it significant that the section provided that no action could be commenced before leave had been granted. Significantly, she observed that "[i]t may well be that if the court gives the plaintiffs leave to commence an action for relief under Part XXIII.1, it would be appropriate at that time to ask that the order be made nunc pro tunc in order to regularize what the plaintiffs have done to date." However, she found that it was premature to consider that form of relief.

[25] On February 25, 2011, perhaps because of the decision in Nor-Dor, the appellant's counsel in this case wrote to the respondents' counsel raising the issue of the limitation period, and suggesting an attendance before the case management judge and the possibility of an agreement to toll the OSA limitation period pending the determination of the leave motion. On February 28, 2011, appellant's counsel wrote to the case management judge, requesting a conference on an urgent basis, noting that it was possible that the limitation period would expire on March 17, 2011 and asking that a schedule be set for the motions for certification and leave.

[26] A case conference was held on March 10, 2011. The motion judge refused to accelerate the leave and certification motions, because he found it would not be procedurally fair to the respondents to do so. Instead, he directed the appellant to bring a motion for "conditional leave" to commence an action under the OSA.

[27] On March 14, 2011, the appellant served a motion, returnable on March 25, 2011, seeking, among other things, a declaration that the three-year limitation period in s. 138.14 of the OSA was suspended by the operation of s. 28 of the CPA, an order granting "conditional leave" to commence an action under s. 138.8(1) of the OSA and an order tolling the limitation period.

[28] The motion was argued on March 25, 2011. As the argument developed, the appellant's request for conditional leave was not pursued. Nor did the appellant request nunc pro tunc relief. The submissions focused on whether s. 28 of the CPA had the effect of suspending the limitation period in s. 138.14 of the OSA on the commencement of a putative class action claiming the statutory remedy, even though leave had not been obtained and the appellant had only asserted an intention to obtain leave.

[29] The motion judge released his decision on March 31, 2011: Sharma v. Timminco Ltd., 2011 ONSC 8024. He found that because the statement of claim referred to an intention to commence an action under Part XXIII.1 of the OSA, s. 28 of the CPA suspended the operation of the limitation period in s. 138.14 of the OSA.

[30] After this decision, the appellant served his material for certification and for leave to pursue the statutory claim. This occurred three years and two days after the last alleged misrepresentation identified in the statement of claim.

[31] But the respondents appealed the motion judge's decision. That resulted in this court's ruling in Timminco #1, allowing the appeal and determining that s. 28(1) of the CPA did not suspend the limitation period until leave was actually granted. Merely asserting an intention to seek leave was not sufficient. This court noted that its conclusion was consistent with the purpose of s. 138.14 of the OSA, which was designed to ensure that secondary market claims would be pursued with dispatch. This, in turn, required the leave motion to be brought expeditiously.

[32] Leave to appeal to the Supreme Court of Canada was refused: [2012] S.C.C.A. No. 157. The appellant's statutory claim was time-barred.

[33] As I have noted, in Green (OCA), a five-judge panel of this court subsequently found that Timminco #1 had been wrongly decided. It held that when a plaintiff in a proposed class action pleaded a cause of action based on s. 138.3 of the OSA, together with the facts that found that claim, and further pleaded the intent to seek leave to commence an action under the OSA, then that claim was "asserted" for the purpose of s. 28 of the CPA, and the limitation period was thereby suspended for all class members.

[34] This court's decision in Green (OCA) was appealed to the Supreme Court of Canada. Mr. Pennyfeather's application for leave to intervene in that appeal was dismissed on December 17, 2014: [2014] S.C.C.A. No. 137.

[35] On December 5, 2015, the Supreme Court of Canada released its decision in Green (SCC). A four-three majority of the court effectively reversed the five-judge panel of this court on the operation of s. 28 of the CPA, but concluded that the court has discretionary jurisdiction to make an order nunc pro tunc in appropriate cases. A different majority decided that the Green action would survive, but for different reasons. I will discuss the Supreme Court's reasons in the next section.

[36] To fast forward, however, after Green (SCC), the appellant stated that he intended to bring a motion for leave to assert the statutory cause of action and to seek nunc pro tunc relief. The respondents brought a motion for a declaration that his claim was barred by res judicata and related doctrines asserting that the same issue had been litigated in the March 2011 motion. The appellant brought a motion for leave to commence the class action nunc pro tunc so as to avoid the limitation period. The motion judge agreed with the respondents on res judicata, but exercised discretion to hear the motion nevertheless. However, he held that it was not appropriate to grant leave nunc pro tunc.

(3) Green (SCC)

[37] To restate and refine the issue on this appeal, it is whether nunc pro tunc relief was available to the appellant and, if so, whether the motion judge made an error in principle in the exercise of his discretion in refusing it. This issue involves the application of Green (SCC).

[38] Green (OCA) and Green (SCC) dealt with three appeals involving the OSA limitation period. In each case, leave to commence the statutory claim had not been obtained within the limitation period. The cases were Green v. Canadian Imperial Bank of Commerce, 2012 ONSC 3637, 29 C.P.C. (7th) 225; Silver v. IMAX Corp., 2012 ONSC 4881; and Trustees of the Millwright Regional Council of Ontario Pension Trust Fund v. Celestica Inc., 2012 ONSC 6083, 113 O.R. (3d) 264.

[39] In Green (SCC), a majority of the Supreme Court comprised of Côté J. (McLachlin C.J. and Rothstein J. concurring) and Cromwell J. (who gave separate reasons) found that s. 28 of the CPA did not suspend the operation of the limitation period for a statutory claim for misrepresentation before leave had been granted under s. 138.8 of the OSA. This was consistent with the conclusions reached in this court's decision in Timminco #1. The effect of this was that the three appeals before the Supreme Court were time-barred, unless nunc pro tunc relief was available, because the limitation period had expired in all three cases before leave had been granted.

[40] The minority, Karakatsanis J., with whom Moldaver and Gascon JJ. concurred, would have dismissed the appeals, finding that the pleading of the statutory cause of action in the statement of claim amounted to the "assertion" of the statutory cause of action for the purpose of s. 28 of the CPA and had the effect of suspending the limitation period as of the date of filing the claim. The minority did not find it necessary to consider the application of the nunc pro tunc doctrine.

[41] There was disagreement among the judges who considered nunc pro tunc on its application to the three cases before the court and the opinions of Côté J. on the one hand and Cromwell J. on the other, require some scrutiny to identify how that doctrine applies.

[42] Côté J. gave the lead judgment. She pointed out that courts have inherent jurisdiction to make orders nunc pro tunc, or, as she said in common parlance, to "backdate" their orders. But she identified an important limit on that jurisdiction in the case of the failure to obtain leave to commence an action before the expiry of a limitation period. The parties refer to this limit as a "red-line rule". The red-line rule requires leave to be sought within the limitation period in order for the court's order to be made nunc pro tunc. An application for leave nunc pro tunc cannot succeed if the application is made after the expiry of the limitation period. Such an order would be of no use to the plaintiff because it would be retroactive to a date after the expiry of the limitation period.

[43] Côté J. noted that the case law had identified a number of "non-exhaustive" factors, none of which was determinative, to be considered in deciding whether to grant a nunc pro tunc order. These included: (a) lack of prejudice to the opposing party; (b) the order would have been granted had it been sought at the appropriate time; (c) the irregularity was not intentional; (d) the order would cure the irregularity; (e) the delay was caused by an act of the court; and (f) the order would facilitate access to justice. However, leave will not be granted nunc pro tunc when it would undermine the purpose of the limitation period.

[44] Côté J. also identified the standard of review, observing that a deferential standard applies to a judge's discretionary decision to grant an order nunc pro tunc. An appellate court can intervene if the judge has exercised his or her discretion on an erroneous principle or has failed to exercise that discretion. But if the judge has given sufficient weight to all the relevant circumstances, an appellate court must defer.

[45] Cromwell J. agreed with Côté J.'s statement of principles, but disagreed with her conclusions on the application of those principles in the Green and IMAX appeals. He agreed with her reasons in Celestica.

[46] In Green, Côté J. would not have granted leave nunc pro tunc primarily because, in her view, the plaintiffs had waited a year and a half after filing their statement of claim before bringing a motion seeking leave under s. 138.8(1) and did nothing to seek an expedited hearing of the leave motion or to address the limitation period issue, simply assuming that they would be granted leave. She observed, at para. 100: "A plaintiff cannot simply assume that he or she will be granted relief, doing nothing although knowing that the limitation period is going to expire." Justice Côté adverted to the leave requirement and the limitation period as central to the "delicate" balance struck by the legislation, which reflected a desire to ensure that unmeritorious litigation be brought to an early end in the litigation process.

[47] Cromwell J. would not have interfered with the motion judge's conclusion in Green that he would have granted nunc pro tunc relief had he found it available. The motion judge's reasons included: (a) the plaintiffs had been diligent in pursuing their action; (b) Timminco #1 was a case of first impression and was a surprise to the bar; (c) the exercise of discretion would not undermine the purposes of the limitation period; (d) it would discharge the court's duty to protect the rights of unrepresented class members; and (e) the plaintiffs' claim had been found to have a reasonable prospect of success.

[48] In Imax, Côté J. upheld the motion judge's exercise of discretion to grant a nunc pro tunc order as against the defendants who were party to the original statement of claim. An important factor influencing that discretion was the motion judge's finding that the motion for leave had been brought promptly and had been actively and vigorously pursued. Nevertheless, Côté J. was highly critical of the plaintiffs, who waited two years after leave was granted to file their statement of claim. Justice Côté would not have granted a nunc pro tunc order against the defendants who were added to the statement of claim more than two years after leave was granted.

[49] Justice Cromwell, on the other hand, would have upheld the motion judge's exercise of discretion as regards to both the "old" and "new" defendants.

[50] Finally, in Celestica, Côté J. found that leave nunc pro tunc was not available because the motion for leave was not filed before the expiry of the limitation period. She found that it was not open to the motion judge to apply the doctrine of "special circumstances" to salvage the claim. She would, therefore, have allowed the appeal. Justice Cromwell agreed with this disposition.

[51] In the result, in Green, the combined effect of Justice Cromwell's decision and the reasons of the three minority judges were to find that the statutory claim was not time-barred and to dismiss the appeal. In IMAX, the combined effect of all three sets of reasons was that all the plaintiffs' OSA claims were not time-barred and the appeal was dismissed. And in Celestica, the majority, consisting of Côté J. (McLachlin C.J. and Rothstein J. concurring) and Cromwell J., allowed the appeal.

B. The Motion Judge's Reasons

[52] I now turn to the motion judge's reasons in the case at bar.

(1) Issue Estoppel and Abuse of Process

[53] The motion judge held that although the appellant's nunc pro tunc argument was barred by issue estoppel and by the abuse of process doctrine, he nevertheless had discretion to hear it, relying in part on Penner v. Niagara (Regional Police Services Board), 2013 SCC 19, [2013] 2 S.C.R. 125, at paras. 29-31. He stated, at para. 76:

In the circumstances of the immediate case, it offends principles of fundamental justice that the fate of Mr. Pennyfeather's statutory claim should be determined by court decisions after hearings in which he did not have an opportunity to be heard. The Supreme Court denied Mr. Pennyfeather leave to appeal the decision ruling his claim untimely, and it denied him leave to intervene in the appeal that restored the decision that his claim was untimely. Having denied him a seat at the table where the fate of his statutory claim was to be determined to be statute-barred, I find it unfair for any court to make an adverse and technical determination about Mr. Pennyfeather's possible entitlement to an order nunc pro tunc when he has not argued his case nor had an opportunity to offer an explanation for his handling of the case. The position of a person seeking a nunc pro tunc order is idiosyncratic, and the idiosyncrasies of Mr. Pennyfeather's circumstances were never argued until the motion now before the court.

[54] The motion judge observed that the appellant's nunc pro tunc assertion was not argued at the March 2011 motion and, although the ability of a court to make an order nunc pro tunc was addressed in Green (SCC), the appellant had been denied leave to intervene in that appeal. The motion judge stated, at para. 77, that "Mr. Pennyfeather's voice on the issue of nunc pro tunc has not been heard until the motion now before the court." He, therefore, exercised his discretion to hear the request for leave under the OSA.

(2) Leave Nunc Pro Tunc

[55] The motion judge then turned to the appellant's request for leave nunc pro tunc, having regard to the principles set out in Green (SCC).

[56] The motion judge found, at para. 94, that because the appellant had not sought leave prior to the expiry of the three-year limitation period, it was not appropriate to grant leave nunc pro tunc. The appellant's motion for "conditional leave" in March 2011 was not a leave motion and a leave motion was never scheduled.

[57] Furthermore, he stated, at para. 95, that the limitation period in the OSA is an "absolute limitation period" that is "not diluted by principles of discoverability." The policy behind it is to "put a premium on finality that will exculpate defendants of liability notwithstanding wrongdoing." Granting the appellant leave nunc pro tunc would be contrary to the purpose of s. 138.14 of the OSA because counsel for the appellant knew about the respondents' alleged misrepresentations for over three years before finally bringing a motion for leave.

[58] Applying the equitable factors from Green (SCC), the motion judge held that, although counsel for the appellant had acted in accordance with the prevailing wisdom that s. 28 of the CPA operated to suspend the limitation period, counsel's diligence was misdirected. There was no adequate explanation for not advancing the proposed class action on the parallel tracks of litigation and settlement.

[59] It was not clear that the respondents were not prejudiced in their ability to defend the action by the passage of time. The respondents could not be faulted for refusing to abandon the limitation defence and they did nothing to induce the appellant to believe that he did not have to worry about the expiry of the limitation period.

[60] Finally, there had been no determination of whether the class action had a reasonable possibility of success under s. 138.8 of the OSA, and so it was not possible to rely on the prospects of success to support a nunc pro tunc order.

C. The Parties' Submissions

[61] The following overview of the submissions of counsel will set the stage for the analysis that follows.

[62] The appellant's central submission is that in finding that he did not meet the "red-line" rule for equitable relief in Green (SCC), the motion judge erred by overlooking the fact that the appellant's motion for "conditional leave" was delivered on March 14, 2011, three days before the expiry of any limitation period. The motion judge also erred, he says, in stating that his conditional leave motion was "abandoned".

[63] The appellant says that delivery of the conditional leave motion on March 14, 2011 established the "tunc" ("then") to which an order granting leave could be made retroactive: nunc pro tunc ("now for then"). The motion judge failed to recognize this and then failed to properly exercise his discretion to grant nunc pro tunc relief.

[64] He says the motion judge made two principal errors in the exercise of his discretion in applying the test for nunc pro tunc relief in Green (SCC). First, the motion judge erred in fact and law by not finding that the appellant had pursued his claim with diligence. Instead, he found that the appellant had been "neither dilatory nor assiduous" in prosecuting the action. The appellant says that this observation was made with the benefit of hindsight and failed to give adequate consideration to the fact that he was acting in accordance with the prevailing professional and judicial wisdom.

[65] Second, he submits that the motion judge made an "egregious" error in principle by failing to give any weight to an important factor – the strength of the plaintiff's case – which he says was plainly meritorious. Instead of considering the merits of the case, on which the appellant adduced evidence and the respondents none, the motion judge treated the merits as neutral because the merits had not been tested in a leave motion.

[66] In addition to these errors, the appellant says that the motion judge also failed to consider that: (i) it was his own act (which the appellant characterizes as an "act of the court"), in refusing to schedule the leave motion which caused the appellant to miss the "red-line" date; (ii) there would be no prejudice to the respondents if nunc pro tunc relief were granted; and (iii) the court has an overriding duty to protect the interests of class members.

[67] An alternative submission, not made in the court below, was that the limitation period had not, in fact, expired because the Photon report remained on Timminco's website until it was taken down on November 11, 2011 and, therefore, the representation was a continuing one.

[68] Finally, the appellant seeks leave to appeal costs. He says that the motion judge made an error in principle in not awarding costs to reflect his partial success on the res judicata, issue estoppel and abuse of process arguments.

[69] The respondents' submission is that the appellant did not deliver a leave motion prior to the expiry of the limitation period on May 29, 2011 and that precludes consideration of nunc pro tunc relief. Filing a motion for "conditional leave" was not sufficient to trigger the red-line rule. Alternatively, they say that if the red-line rule was met, the motion judge did not err in his assessment of the discretionary factors and his decision is entitled to deference.

[70] On their cross-appeal, the Timminco respondents submit that the motion judge erred in his application of the principles of res judicata, issue estoppel, and abuse of process. They say that the motion judge should have declined to consider whether the appellant was entitled to seek nunc pro tunc relief because the "conditional leave" sought in March 2011 was exactly the same relief as was sought before the motion judge here.

[71] In response to the cross-appeal, the appellant says that issue estoppel cannot apply because the issue of nunc pro tunc relief was never previously considered and there was no reason to raise it before the motion judge because he made it clear that he was going to rule that s. 28 of the CPA operated so as to suspend the limitation period in s. 138.14 of the OSA. There was no basis to request nunc pro tunc relief at the time.

D. Analysis

[72] I will begin by considering whether the appellant's claim for nunc pro tunc relief is barred by the so-called "red-line rule" in Green (SCC) because the appellant did not bring a leave motion before the limitation period expired. I will then examine the appellant's submission that the motion judge committed an error in principle in refusing nunc pro tunc relief. I conclude that even if the appellant can get past the red-line rule, which he might, he has not demonstrated that the motion judge erred in the exercise of his discretion to deny nunc pro tunc relief. I would also dismiss the appellant's argument that the limitation period was extended by the continued presence of the Photon report on Timminco's website and his request for leave to appeal costs. As I explained earlier, although it is unnecessary to consider the cross-appeal, I will explain why I agree with the reasoning of the motion judge.

(1) The Appeal – Nunc Pro Tunc Relief

(a) The Red-line Rule

[73] The appellant argues that the motion judge erred in applying the "red-line rule". He says that it was the motion judge's own act in refusing to schedule the leave motion that put him off-side. He submits the motion judge should also have considered the appellant's state of readiness because draft leave materials had been provided to defence counsel several months before the conditional leave motion, apparently in the hope of promoting settlement discussions.

[74] A great deal of effort has been expended by the parties on the issue of whether the March 25, 2011 motion was or was not a leave motion which would meet the "red-line rule" and, if it was, whether the appellant's request for "conditional leave" was "abandoned" as the motion judge found, at para. 27.

[75] In considering this issue, it is appropriate to note that at a case conference on March 10, 2011, the appellant's counsel had asked the motion judge to accelerate the scheduling of a certification and leave motion in view of the impending limitation period. The motion judge declined to do so, because he did not think it would be fair to the respondents, who had not been served with formal motion materials and had not had an opportunity to prepare responding material. He did, however, direct the appellant to bring a motion to seek "conditional leave" of the court to commence an action under the OSA and to serve that material by March 14, 2011. The material was duly served and the motion was argued on March 25, 2011.

[76] The motion sought both an order granting "conditional leave" to commence an action under s. 138.3 of the OSA and an order declaring that the limitation period in s. 138.14 of the OSA had been tolled pursuant to s. 28 of the CPA. The appellant's factum on the motion argued that the court had the jurisdiction to grant relief against the limitation period or to grant conditional leave, until such time as the leave hearing could be scheduled.

[77] The meaning of "conditional leave" was not clearly defined. Presumably the intent was that if leave was ultimately granted on the merits, it would be "backdated" or made nunc pro tunc to the date of conditional leave, so as to retrospectively toll the limitation period. In effect, the conditional leave motion was a request for prospective nunc pro tunc relief. Arguably, if leave was ultimately granted, the motion requesting conditional leave would serve as the "tunc" to which the leave order could be "backdated".

[78] Looking at what took place at the motion, it appears that the request for "conditional leave" was not so much abandoned, as it was superseded by the focus of all concerned, including the motion judge, on the issue of whether the limitation period had been tolled by the commencement of the class action, pursuant to s. 28 of the CPA. This was certainly a commonly-held view, shared by the motion judge, before the "bomb shell" of Timminco #1. In this context, it is not surprising that the request for conditional leave was put to one side.

[79] Were it necessary to decide this issue, it is my view that the motion for conditional leave could have served as the anchor for nunc pro tunc relief, had leave ultimately been granted. In Green (SCC), Côté J. emphasized that an order nunc pro tunc cannot be granted where it would undermine the purpose of the limitation period or the legislation at issue. When a limitation period has expired, backdating the order to a date before the motion for leave was brought would, on its own, frustrate the purpose of the limitation period. However, in the circumstances here, it is not clear to me that using the March 2011 "conditional leave" motion as the anchor for an order nunc pro tunc would necessarily undermine the purpose of the limitation period. In any event, because I would uphold the motion judge's discretionary refusal to grant nunc pro tunc relief, I find it unnecessary to decide this issue.

(b) The Discretionary Factors

[80] As I have noted, both Côté J. and Cromwell J. in Green (SCC) referred to the deference to be accorded to a judge's exercise of discretion in either granting or refusing an order nunc pro tunc. Côté J. observed that "if the judge has given sufficient weight to all the relevant considerations, an appellate court must defer to his or her exercise of discretion" (at para. 95). But if the discretion is not exercised, or is exercised on the basis of an erroneous principle, an appellate court is entitled to intervene.

[81] Those observations are particularly apt in this case because the motion judge had been case managing this class action since its commencement in May 2009. He heard the carriage motion and a motion for the production of Timminco's insurance policies and, of course, the original motion declaring that the limitation period was tolled by the operation of s. 28 of the CPA. He had case managed other securities class actions and had lived through the roller coaster of the jurisprudence from Timminco #1 through to Green (SCC). He was well placed to assess the history of this action and to determine whether the equities required granting discretionary relief nunc pro tunc.

[82] The appellant says that the motion judge committed errors in principle: (i) in failing to find that the appeal was pursued diligently; (ii) in failing to find that the appellant's claim had merit and, instead, treating the merits as neutral; and (iii) in failing to find that the delay was caused by an "act of the court". I will consider these arguments before considering two other factors, namely (iv) prejudice to the respondents and (v) the protection of the class.

(i) Diligence

[83] The appellant says the motion judge erred in finding that he was "neither dilatory nor assiduous" in prosecuting the action. He says that this observation failed to give adequate consideration to the prevailing professional and judicial wisdom of the day.

[84] I note the significance of the requirement of diligence. As Côté J. observed in Green (SCC), the purpose of the statutory limitation period was to ensure that leave would be sought and obtained at an early stage. This reflected a concern for the damage that could be done to a public issuer and its long-term shareholders by unmeritorious class actions, particularly if those actions were left to languish. The diligence of the proposed representative plaintiff in advancing the action towards a leave hearing is, therefore, an important consideration in determining whether an order nunc pro tunc is consistent with the statutory purpose.

[85] To review the appellant's diligence in pursuing his claim, recall that the action was commenced on May 14, 2009 and carriage was awarded to his counsel in October 2009. In their affidavit in support of their carriage motion, the appellant's counsel deposed that the case was not likely to settle and that, if granted carriage, they would be in a position to "proceed expeditiously" towards a leave and certification motion.

[86] This is not what happened.

[87] Mr. Sharma, who was then the representative plaintiff, had indicated in the summer of 2009 that he was unable to continue in that capacity and asked to be removed. At the time of the carriage motion in October 2009, counsel indicated that Mr. Pennyfeather was prepared to assume the role. This would, however, require a motion and the respondents insisted that this be done on affidavit evidence of Mr. Pennyfeather's suitability. Although a motion to substitute Mr. Pennyfeather as the representative plaintiff was served in January 2010, it was not accompanied by an affidavit from either Mr. Sharma or Mr. Pennyfeather. It was not until February 2011 that the appellant asked the motion judge to schedule a motion to appoint Mr. Pennyfeather in Mr. Sharma's stead and this motion was heard, together with the "conditional leave" motion, on March 25, 2011.

[88] The consequence was that the proposed class action effectively had no representative plaintiff, a fundamental requirement for certification, for some 18 months. The failure to attend to this most basic and essential of tasks does not reflect diligence in the prosecution of the action.

[89] But this was not the only matter left undone. The respondents had served a demand for particulars in December 2009. While the appellant delivered a draft amended statement of claim, it did not fully respond to the respondents' demand. Thus another very basic task, regularizing the pleading, had not been addressed.

[90] What then was going on in the class action?

[91] By the time of the carriage motion, in the fall of 2009, it was very clear that Timminco was in serious financial difficulties. It was in this context that the appellant moved to compel disclosure of the respondents' insurance policies, for the clear purpose of informing settlement discussions. On February 3, 2010, the motion judge ordered disclosure. Leave to appeal to the Divisional Court was denied on April 22, 2010. On May 27, 2010, the Timminco respondents disclosed their insurance policies, including the limits of their coverage.

[92] A fair reading of the record indicates that thereafter, between mid-May 2010 and mid-February of 2011, very little was happening in the action other than occasional settlement overtures from the appellant's side. In December 2010, the appellant delivered draft certification and leave materials, for the express purpose of facilitating settlement discussions. Considering the affidavit evidence of the appellant's counsel on the carriage motion that the action was unlikely to settle, it is clear that the appellant's strategy had changed from expeditious prosecution of the action to settlement.

[93] It was in this context, with only three weeks before the limitation period applicable to the first alleged misrepresentation was to expire, on February 25, 2011, that the appellant's counsel wrote to the respondents' counsel, raising a concern about the potential approach of the limitation period and suggesting a tolling agreement. On February 28, 2011, the appellant's counsel wrote to the motion judge on "an issue of some urgency regarding a potential approaching limitations period in this action." The letter continued that in addition to discussing possible solutions to the limitation issue, counsel would be "requesting that a timetable be set for a motion to substitute the representative plaintiff and the motions for certification and leave".

[94] It is not unreasonable to ask, in considering the diligence factor, why the issue only became of "some urgency" shortly before the potential expiry of the limitation period. While the "conventional wisdom" may have been that s. 28 of the CPA would save the day, this did not stop some counsel from advancing their leave motions expeditiously. In IMAX, for example, the motion had been brought and fully argued before the limitation period expired. In other cases, including Gould v. Western Coal Corp., in which appellant's counsel in the case at bar acted for the representative plaintiff, a tolling agreement was negotiated with the defendants. Even in Green, where Côté J. would have refused nunc pro tunc relief, the plaintiffs had brought their motion for leave within the limitation period.

[95] The motion judge found, at para. 18, that in prosecuting the action after the carriage motion, the appellant's counsel "were neither dilatory nor assiduous", but were "practicing in accordance with the standard of practice at the time." But later in his reasons, in comparing the facts of this case to IMAX and Green, he observed that the case for nunc pro tunc relief was weaker in this case. The appellant's diligence was misdirected – he focused his efforts on attempting to get at Timminco's insurance and to persuade its counsel to settle the case and, according to the motion judge, "had no adequate explanation for not advancing the proposed class action on the parallel tracks of negotiation and prosecution of the proposed statutory claim" (at para. 97).

[96] Effectively, between February 2010, when the motion judge granted the appellant's motion for production of Timminco's insurance policies, and the flurry of activity at the end of February 2011, nothing much appears to have been happening to advance the action against the Timminco respondents except for the appellant's efforts to settle. The action was effectively moribund as regards the other respondents.

[97] It is important to note that the motion judge found, at para. 97, that the respondents had done "nothing to lull Mr. Sharma or Mr. Pennyfeather into thinking that he did not have to worry about the ticking limitation clock … [and] nothing to lull or induce Mr. Pennyfeather not to pursue the prosecution of the statutory claim and he was capable of pursuing the claim."

[98] The motion judge's conclusion that the appellant was neither dilatory nor assiduous is supported by the evidence. Indeed, it was a very charitable assessment of the appellant's prosecution of the litigation. Unlike Green and IMAX, which had remained focused on proceeding to the leave motion, this was a case in which the appellant made a strategic decision to focus on settlement rather than on advancing the leave motion on a parallel track, as the motion judge found.

(ii) Merits

[99] The appellant's second submission is that the motion judge made an "egregious" error in principle by failing to give any weight to the merits of the appellant's case. The appellant says the claim is plainly meritorious. He says that the merits of the claim are conclusively established by the fact that Timminco's much heralded "proprietary" process was sold for a pittance in the CCAA asset sale. This demonstrates, he says, that the process was a sham.

[100] He says that instead of considering the merits of the case, on which the appellant adduced evidence and the respondents none, the motion judge treated the merits factor as neutral because the merits had not been tested in a leave motion.

[101] In my view, this finding was open to the motion judge. The merits of the case were untested by a contested leave motion. This is in stark contrast to IMAX where the claim passed the OSA merits test after a lengthy contested hearing on a voluminous record. It also stands in contrast to Green, where, again after a contested leave motion, it was found that the claim had a reasonable possibility of success and leave would have been granted but for the limitations defence.

(iii) Act of the Court

[102] The appellant points out that in Green (SCC), Côté J. said that one factor that can be considered in the exercise of discretion to grant leave nunc pro tunc is whether delay has been caused by an "act of the court". Indeed, this doctrine of "act of the court" was identified by van Rensburg J. (as she then was) in IMAX as a basis for granting nunc pro tunc relief when the limitation period was about to expire while her decision on the leave motion was under reserve. Even there, however, Côté J. observed that "the plaintiffs' delay in filing their action far outweighed any delays caused by acts of the court in respect of which a nunc pro tunc order might be justified" (at para. 105).

[103] The appellant asserts that the motion judge erred by failing to find that the delay was caused by an act of the court – the motion judge's refusal to schedule the leave motion or to permit the delivery of a leave motion before the expiry of the limitation period.

[104] In my view, the delay here was not caused by an act of the court – it was caused by the appellant's decision to focus on settlement rather than to advance the statutory claim. It was unrealistic to expect the motion judge to schedule the leave motion at the eleventh hour. The motion judge gave valid reasons for refusing to do so.

(iv) Absence of Prejudice

[105] Neither Côté J. nor Cromwell J. gave a great deal of consideration to the absence of prejudice to the defendants if leave were to be granted nunc pro tunc. In both IMAX and Green, the case had moved forward relatively expeditiously and the defendants had responded to the leave motion. In Imax, the leave motion was brought and fully argued before the limitation period expired. In Green, the leave motion was brought before the limitation period expired and it was being argued on a contested basis when Timminco #1 was released.

[106] In this case, Timminco made it clear that it would consider settlement but that the appellant should pursue the parallel track of advancing his claim and should proceed as he saw fit. The respondents clearly did not, either expressly or impliedly, abandon their right to rely on the limitations defence. The motion judge was not persuaded that the delay would not prejudice Timminco in the defence of its claim. In other words, the appellant has failed to demonstrate an absence of prejudice to the respondents.

(v) Duty to Protect the Class

[107] The appellant says that the motion judge erred in principle in failing to consider his duty to protect unrepresented putative class members who could reasonably assume that they could shelter under the action. This argument found favour with Cromwell J. in Green (SCC), at paras. 142-143. However, Côté J. dismissed it, at para. 102, observing that "class members do not have more rights than the representative plaintiff."

[108] It is not clear that this factor was argued before the motion judge. If it had been, the interests of the defendants and the overall policy goals of the legislation of preventing strike suits and ensuring that any claim is advanced expeditiously, would have had to be balanced against the duty to protect the class. The interests of unrepresented class members are a consideration in every putative class action. In my view, those interests could not have justified nunc pro tunc relief from the limitation period.

[109] In summary, in my view, the motion judge made no error in principle in the exercise of his discretion not to grant nunc pro tunc relief. Granting such relief in the circumstances of this case would have been inconsistent with the purpose of the limitation period – "to ensure that leave will be sought and obtained quickly" (per Côté J., at para. 96).

(2) The Extension of the Limitation Period for Later Purchasers

[110] The appellant advanced an argument on appeal that was not raised in the court below. He submits that the limitation period did not expire for all class members on May 29, 2011, three years after the date of the last misrepresentation pleaded in the statement of claim. He submits that the Photon Report remained on Timminco's website until November 11, 2008 and that it gave rise to a new representation each day, triggering the running of a fresh limitation period for every class member who purchased shares between May 14, 2008, the day the Photon Report was posted on Timminco's website, and November 11, 2008, when the Photon Report was taken down. Thus, claims based on those fresh misrepresentations were not time-barred when the appellant ultimately filed his motion for leave on June 13, 2011.

[111] The appellant relies on a timeline of this proceeding contained in para. 20 of the reasons of Côté J. in Green (SCC), under the heading "Judicial History and Facts" for the various proceedings. In that timeline, Côté J. set out the date of the alleged misrepresentations in this action as being from March 17 to November 11, 2008 and the expiry of the limitation period for the statutory action as running from March 17 to November 11, 2011.

[112] I would reject the appellant's submission for the following reasons.

[113] First, and primarily, the appellant's submission is based on a misconception of the operation of the statutory limitation period. It does not run from the date on which an individual class member saw or heard the misrepresentation or purchased his or her individual shares. It runs from "the date on which the document containing the misrepresentation was first released" (s. 138.14(1)(a)(i)). As Côté J. noted in Green (SCC), at para. 66, the statutory limitation period was "expressly designed to run without regard for the 'plaintiff's knowledge of the facts giving rise to the cause of action'".

[114] Thus, it is irrelevant to the running of the limitation period that the Photon report remained on Timminco's website and may or may not have been seen by persons who purchased shares after the date of its first release. The limitation period began to run against all purchasers of Timminco's shares from the date of the "first release" of the report.

[115] Second, this theory was neither pleaded as part of the appellant's case nor advanced in the court below. The statement of claim pleads that the respondents made representations during the class period which caused Timminco's share price to be artificially inflated. Under the heading "The Misrepresentations during the Class Period", the appellant alleged a series of misrepresentations between March 17 and May 29, 2008 in statutory disclosure statements, press releases and conference calls with analysts and investors. These misrepresentations allegedly inflated the price of Timminco's shares.

[116] The statement of claim identified November 11, 2008 as the end of the class period. That was the date on which the Photon Report was removed from Timminco's website, on the ground, according to the pleading, that "some of the material factors or assumptions originally used to develop the forward-looking information in the Photon Report, including in respect of revenues, production line volumes and costs, may no longer be valid."

[117] The removal of the Photon Report and other actions by Timminco were "corrective statements" and the "truth emerged", according to the statement of claim. Thus, the theory of the appellant's case was that the respondents' misrepresentations artificially inflated the value of Timminco's shares during the class period and when the "truth emerged" at the end of the class period the share price came crashing down. Purchasers who acquired shares during the class period can avail themselves of the statutory remedy, not because they relied on the misrepresentations, but because the misrepresentations allegedly inflated the price at which they bought their shares.

[118] Rule 25.06(8) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 requires a plaintiff to plead full particulars of any misrepresentation. The obvious purpose is to avoid surprise. Nowhere in the statement of claim does the appellant plead a theory of a representation after May 29, 2008 or any continuing representations.

[119] In my view, the tables set out by Côté J. in Green (SCC) were simply for comparative purposes and cannot have been intended to state any conclusion on the expiry of the limitation period in this case, which was obviously not before her.

[120] For these reasons, I would dismiss this ground of appeal.

(3) The Costs Appeal

[121] The appellant seeks leave to appeal the motion judge's award of costs of $124,028.81 to the Timminco respondents and $25,330.07 to the Photon respondents. He submits that: (a) success was divided and there should have been no order as to costs or costs should have been apportioned to reflect the divided success; (b) the award failed to consider the policy objectives of the CPA; and (c) the costs were unreasonable for a one-day hearing with no new substantive evidence.

[122] It has been said time and time again that the awarding and fixing of costs is highly discretionary and is afforded a high level of deference on appeal. An appellate court may interfere where it finds that the judge in the court below misdirected himself or herself on the law or made a palpable error in the assessment of the facts: British Columbia (Minister of Forests) v. Okanagan Indian Band, 2003 SCC 71, [2003] 3 S.C.R. 371, at para. 42; Walker v. Ritchie, 2006 SCC 45, [2006] 2 S.C.R. 428, at para. 17. Accordingly, leave to appeal a costs order is granted sparingly and only where there are strong reasons to believe that the lower court erred: McNaughton Automotive Ltd. v. Co-Operators General Insurance Co., 2008 ONCA 597, 95 O.R. (3d) 365, at paras. 23-27.

[123] Here, the motion judge found that, in substance, success was not divided. While he dismissed the respondents' technical res judicata argument, the effect was simply to permit the appellant to argue his case on the merits. And the result was that "Mr. Pennyfeather's already dead action will not rise like a legal phoenix."

[124] He rejected the appellant's public interest argument, based on the goals of the CPA, finding that this was "high stakes class action securities litigation where the proposed representative plaintiff and class counsel understand the risks of the exposure to an adverse costs award."

[125] The motion judge considered the principles governing the award of costs, including the principles that costs normally follow the event and that the award should reflect the reasonable expectations of the parties. He also considered the discretionary factors set out in r. 57.01. As he noted, the parties were litigating a claim said to be worth about half a billion dollars. He observed that "[t]he motions and the underlying litigation are off the measuring scale for legal, factual, and procedural complexity and in importance to the parties" (at para. 13).

[126] The motion judge's decision with respect to costs was based on his consideration of the relevant principles. The appellant has identified no error in principle in the exercise of his discretion. I would refuse leave to appeal.

(4) The Cross-Appeal

[127] My disposition of the appeal makes it unnecessary to determine the cross-appeal. I will nevertheless briefly explain why, in my view, the motion judge did not err in the exercise of his discretion to hear the appellant's motion.

[128] The cross-appeal raises a novel and challenging question, namely whether the principle in Henderson v. Henderson (1843), 67 E.R. 313, 3 Hare 100 (V.C.), applies to issue estoppel. That principle, applicable to cause of action estoppel, holds that a final decision of the court bars re-litigation not only of what was decided, but also what could and should have been decided by the court. The motion judge concluded that both issue estoppel and abuse of process likely applied to prevent the appellant from seeking nunc pro tunc relief because he could have requested that relief when he brought his "conditional leave" motion or on his previous appeal to this court.

[129] However, there is a discretionary element to the application of those doctrines: Danyluk v. Ainsworth Technologies Inc., 2001 SCC 44, [2001] 2 S.C.R. 460 and Penner. The motion judge found it was appropriate to exercise that discretion in Mr. Pennyfeather's favour because Mr. Pennyfeather never had an opportunity to make the argument. He was denied leave to appeal to the Supreme Court in the original Timminco #1 case and he was not permitted to intervene in the appeal to the Supreme Court in Green (SCC). Thus, he never had an opportunity to make an argument about his entitlement to nunc pro tunc relief and it was in the interest of justice that he be given an opportunity to do so.

[130] Timminco refers to this court's decision in College of Traditional Chinese Medicine Practitioners and Acupuncturists of Ontario v. Federation of Ontario Traditional Chinese Medicine Assn., 2015 ONCA 851, leave to appeal to S.C.C. refused, [2016] S.C.C.A. No. 25, for the proposition that a party cannot avoid issue estoppel by "reframing" its legal position and re-litigating "what in substance was the same argument by giving it a different legal label." Timminco says that in this case, the appellant sought an order for conditional leave in March 2011, relying on the court's inherent jurisdiction, which is the same as its motion for nunc pro tunc with a different legal label. If the court had granted conditional leave, and a leave motion was subsequently heard and granted, the order would have been "backdated" to the date of conditional leave – in precisely the same way as it would have been if leave had been granted nunc pro tunc to the date of the notice of motion.

[131] Timminco says that the motion judge erred in principle in his application of Danyluk because this was a case in which the purposes, processes and stakes in the two proceedings were identical. See Penner, at para. 39; Salasel v. Cuthbertson, 2015 ONCA 115, 124 O.R. (3d) 401, at para. 20.

[132] Given the way the proceeding evolved, I have some doubt as to whether any of res judicata, issue estoppel or abuse of process applies. In any event, if they do apply, I would not interfere with the motion judge's exercise of discretion to hear the motion.

[133] It bears noting that at the case conference on March 10, 2011, the motion judge directed the appellant to bring a motion for "conditional leave" to commence an action under the OSA. He noted in his reasons that the appellant "abandoned" his request for conditional leave at the hearing of the motion and focused on his submission that s. 28 of the CPA suspended the operation of the limitation period, as the motion judge ultimately found. It is significant, however, that the motion judge found that the request for "conditional leave" was not a request for nunc pro tunc relief, was not an issue on the table at the March 25, 2011 hearing and was not argued on that date.

[134] It is equally apparent that the issue of nunc pro tunc relief was not raised before this court in Timminco #1.

[135] The motion judge's discretionary decision is subject to the standard of review set out in Penner, at para. 27:

A discretionary decision of a lower court will be reversible where that court misdirected itself or came to a decision that is so clearly wrong that it amounts to an injustice. Reversing a lower court's discretionary decision is also appropriate where the lower court gives no or insufficient weight to relevant considerations. [Citations omitted.]

[136] In my view, the motion judge did not err in exercising his discretion to hear the motion for leave nunc pro tunc, because the appellant never had an opportunity to raise an issue which subsequent jurisprudence revealed should have been raised. Unlike the plaintiffs in Green, IMAX and Celestica, he did not have the opportunity to seek nunc pro tunc relief in the context of the Supreme Court's authoritative statement concerning the operation of the OSA limitation period and the availability of nunc pro tunc relief.

[137] The motion judge acknowledged, at para. 24, that at the time he shared the conventional wisdom, affirmed by a five-judge panel of this court in Green, that s. 28 of the CPA suspended the running of the limitation period in the OSA. The motion judge was uniquely positioned to make this discretionary decision and Timminco has not established that he erred in principle in doing so.

E. Disposition

[138] For these reasons, I would dismiss the appeal. It is unnecessary to consider the cross-appeal and I would dismiss it as moot.

[139] Counsel agreed that costs of $50,000 should be awarded to the successful party on the appeal and costs of $25,000 to the successful party on the cross-appeal, both amounts inclusive of disbursements and all applicable taxes. In the circumstances, I would simply award costs to the respondents in the amount of $50,000, all-inclusive.

Released: May 8, 2017

"George R. Strathy C.J.O."

"I agree K.M. Weiler J.A."

"I agree M.L. Benotto J.A."

Footnotes

[1] For a discussion of the background of the legislation, see also: Ainslie v. CV Technologies Inc. (2008), 93 O.R. (3d) 200 (S.C.), leave to appeal to Div. Ct. granted, appeal discontinued, at paras. 7-13; Silver v. Imax Corp. (2009), 66 B.L.R. (4th) 222 (Ont. S.C.), leave to appeal to Div. Ct. refused, 2011 ONSC 1035, at paras. 225-238.

[2] A subsequent legislative amendment now addresses this question. Pursuant to s. 138.14(2) of the OSA, the limitation period is suspended on the date a notice of motion for leave is filed with the court.