Ashak v. Ontario (Family Responsibility Office), 2013 ONSC 39

Citation and Court Information

CITATION: Ashak v. Ontario (Family Responsibility Office), 2013 ONSC 39 DIVISIONAL COURT FILE NO.: 360/12 COURT FILE NO.: 06-CV-303695PD3 DATE: 2013-01-07

ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT

BETWEEN:

Haiata Ashak, both personally and as Litigation Guardian for Steven Toma, Mona Toma, and Mary Toma Plaintiffs

– and –

Her Majesty the Queen in Right of Ontario as Represented by the Director for the Family Responsibility Office Defendant

COUNSEL: John W. Bruggeman, for Haiata Ashak, Plaintiff (Responding Party) Lise Favreau & Chantelle Blom, for the Defendant (Moving Party)

HEARD: October 17, 2012

Reasons for Decision

LEDERER J.:

Introduction

1The government of Ontario put in place the Family Responsibility Office (“FRO”). It enforces court-ordered support payments on behalf of those entitled to receive them. It takes over and acts on what would otherwise be private rights. The question at the core of this action is whether, in doing so, it has taken on a duty of care or established that it owes a fiduciary duty to the individuals on whose behalf the money is collected.

2This is an application for leave to appeal an order made by Mr. Justice Grace. I begin by observing that counsel has mis-conceived the import of the order. It responded to a motion for summary judgment. The motion was dismissed. It is the order and not the reasons of the judge that is subject to appeal. An order that dismisses a motion for summary judgment is an interlocutory order and, thus, subject to appeal to the Divisional Court, with leave (see: Courts of Justice Act, R.S.O. 1990, Chap. C. 43 s. 19(1)). The defendant is seeking leave for only a portion of the reasons issued by the judge. It is not that counsel for the defendant accepts the finding of that part of the reasons for which leave is not being sought. Rather, counsel has advised that the issue for which leave is not sought has been appealed directly to the Court of Appeal. It is not proper to parse reasons in this way. The order as a whole is subject to leave to appeal. I shall discuss this further as these reasons progress.

Background

3It was generally understood that there were too many recalcitrant spouses refusing to make the support payments they had been ordered, by the courts, to pay. In response, the province of Ontario passed and proclaimed the Family Responsibility and Support Arrears Enforcement Act (the “FRSAEA”)¹ which, in company with a federal statute, the Family Orders and Agreements Enforcement Assistance Act,( the “FOAEA”)², put in place a program through which recipient spouses were supported in an effort to ensure that the payments ordered were made.

4The legislation created FRO. All child and spousal support orders made in Ontario are automatically registered with FRO for enforcement.³ It is the duty of FRO to enforce the orders and pay the amounts collected to the persons to whom they are owed.⁴ Part III of the FOAEA provides assistance to provincial enforcement services, like FRO, in enforcing support orders by providing for the denial of certain federal licences, such as Canadian passports, to debtors who are in persistent arrears.⁵

5Munir Toma was the husband of the plaintiff, Haita Ashak, and the father of the three other plaintiffs. He was ordered, by the court, to pay support to each of his three children and to his wife. He made no payments. FRO became involved. According to the record, Munir Toma was $200,000 in arrears. His passport was suspended. In exchange for a payment of $5,000 and a promise to come back to Canada, his passport was re-instated so that he could go to Iraq and move his new family. He did not return. Munir Toma is now dead. The plaintiffs believe that, by restoring the passport of Munir Toma and allowing him to leave the country, FRO caused them to lose the opportunity to collect the arrears of support.

The Action

6The plaintiffs have commenced this action. It alleges that FRO was negligent and breached the fiduciary duty it owed the plaintiffs. The defendant moved for summary judgment.

The Procedural Problem: Part 1

7Mr. Justice Grace refused the order. In respect of the claim for negligence, the judge applied the test from Anns v. Merton London Borough Council.⁶ He applied the first stage of the test which required a determination of whether the relationship between FRO and the plaintiff “…disclose[d] sufficient foreseeability and proximity to establish a prima facie duty of care…”.⁷ After a careful and comprehensive analysis, Mr. Justice Grace found a prima facie duty of care had been established.

8It is this part of the decision which, counsel advised, has been appealed to the Court of Appeal. The Notice of Motion before me says:

The Crown has an appeal as of right in respect of the final determination that it owes a prima facie duty of care to the plaintiffs, and such an appeal will be brought to the Court of Appeal.

9Mr. Justice Grace did not separate this finding from what followed. He wrote: “This aspect of the analysis is not complete” ⁸ and went on to consider the second stage of the “Anns test”. It asks “…are there any residual policy considerations which ought to negate or limit the duty of care?”⁹ The judge reviewed the arguments, made on behalf of the defendant, and concluded that: “It is inappropriate at the summary judgment stage and on the evidence before me to decline to recognize a duty of care on this ground”.¹⁰ The defendant separates the two aspects of the reasons. It seeks leave with respect to the second finding. The Notice of Motion notes:

On this motion for leave to appeal, the Crown seeks leave to appeal from the motion Judge’s interlocutory determinations that…(b) a trial is required to determine whether there are policy reasons for negating the finding of a prima facie duty of care.¹¹

10This did not end the judge’s consideration as to whether there should be an order for summary judgment in regard to the claim of negligence. Mr. Justice Grace was not prepared to determine whether any duty of care that was present had been breached:

…In my opinion, it is not appropriate on the record before me to attempt to address the question of whether the applicable standard of care was met. I simply do not have a sufficient appreciation of the evidence to make dispositive findings.¹²

11It was for these reasons that, insofar as the claim for negligence was concerned, Mr. Justice Grace dismissed the motion for summary judgment. There is no suggestion in the order that a request for partial summary judgment was made, considered or granted. There is no reference to a motion being made pursuant to Rule 21 of the Rules of Civil Procedure (“determination, before trial of a question of law”). The Amended Notice of Motion that was before the judge seeks only: “An Order for summary judgment dismissing this claim against the defendant...”¹³ The only rules it relies on are Rule 20 (summary judgment) and Rule 37 (the jurisdiction and procedure for motions).

12The motion for summary judgment having been dismissed in its entirety, leave is required for the order as a whole if it is to be appealed. The order is not to be subdivided as a result of the separate response to individual issues that may be found in the reasons which accompany the order. In such circumstances, a judge being asked to grant leave may define the issues that are to be the subject of any appeal. The problem with this case is that no submissions were made seeking leave with respect to the finding of Mr. Justice Grace that a prima facie duty of care exists. Both parties appear to have accepted that there is an appeal as of right to the Court of Appeal on this question. I shall return to this later. For the moment, I will deal with the issues on which submissions were made.

The Test for Leave to Appeal

13The test for leave to appeal is well-known. It is found in Rule 62.02(4). There must either be a decision which conflicts with the order for which leave to appeal is being sought or the judge must find that there is reason to doubt its correctness. If the former criteria is satisfied, the judge must, in addition, be of the opinion that it is “desirable” that leave be granted and, if the latter criteria is demonstrated, then the judge must go on to determine that the appeal involves matters of such importance that leave should be granted.

14In applying this test, it is important to remember the substance of the decision made by Mr. Justice Grace. He did not dismiss the action. He dismissed the motion. The result is that there is to be a trial on the issues raised by the action. For leave to appeal to be granted, there must be a decision which conflicts with or reason to doubt the correctness of that finding.

Analysis

Negligence

15Counsel for the defendant submitted that, accepting that there is a prima facie duty of care owed by FRO to the plaintiffs, there are policy considerations which ought to negate it. The concern raised is that the decision of Mr. Justice Grace failed to properly account for the second stage of the “Anns test” and that leave to appeal that issue should be granted. A motion for summary judgment is to succeed where there is no genuine issue requiring a trial (see: Rule 20.04(1)(a) of the Rules of Civil Procedure). As with Rule 21.01(1)(b) (motion to strike a pleading), it must be plain and obvious that the plaintiff cannot succeed:

In that regard, I also need to be guided by what Feldman J.A. stated in Hasket as to the proper approach for applying the Anns test in the context of a Rule 21 motion that would also be applicable to these Summary Judgment motions. The issue at this stage is not whether duty of care will be recognized; rather, the court applies the two-stage analysis to determine whether it is plain and obvious that no duty of care can be recognized. Feldman J.A. also considered the proper approach to dealing with policy concerns that might exclude liability, that if it is not plain and obvious, the issue will be determined at trial.

[Emphasis added]¹⁴

16The substance of the determination made by Mr. Justice Grace was that it was not plain and obvious that the plaintiffs could not succeed in showing that there was a duty of care owed by FRO to the plaintiffs that was not negated or displaced by the residual policy considerations to be accounted for in the second stage of the “Anns test”. He was unprepared to accept the submission, made on behalf of the defendant, that the imposition of a duty of care would give rise to indeterminate liability and that this was demonstrative of a policy consideration that should negate the finding of a prima facie duty of care. The judge was given examples of cases where this concern was raised.¹⁵ The argument was based on the proposition that FRO had no control over how many family support orders were made and registered or how many of the individuals who were ordered to pay would be unwilling or unable to do so. It was said that because FRO was not a party to the proceedings within which the orders that were registered with it were made, it was unable to ask for the terms of the orders to be varied in recognition of a change in the circumstances of the party paying such that it was no longer reasonable or practical to continue with enforcement.¹⁶

17Mr. Justice Grace found that this did not establish a risk of indeterminate liability. He pointed out that there were “…a myriad of enforcement mechanisms at the Director’s disposal” and that the act conferred “...considerable discretion”.¹⁷ Most importantly, he noted that the very idea that FRO could not control the volume of the orders requiring enforcement was addressed in the FRSAEA. The legislation allows the Director “at any time” to “refuse to enforce a support order...if in his or her opinion...enforcement...is otherwise unreasonable or impractical”¹⁸. In other words, FRO does not need to vary the terms of an order. It has the discretion to conclude that it is not practical to enforce an order without any intervention by the court.

18There are no decisions which could be said to conflict with this finding.

19In Hercules v. Ernst & Young¹⁹ , the first of the three cases referred to Mr. Justice Grace, shareholders sued over concerns for the quality of certain financial statements on which they had relied in making certain personal investment decisions. The Supreme Court of Canada found that Ernst & Young, as the auditors who prepared the statements, clearly owed a prima facie duty of care to the appellants as individual shareholders in the business²⁰. In coming to this finding, the Court noted the changing acceptance of the work of the auditors of a business:

The general area of auditors’ liability is a case in point. In modern commercial society, the fact that audit reports will be relied on by many different people (e.g., shareholders, creditors, potential takeover bidders, investors, etc.) for a wide variety of purposes will almost always be reasonably foreseeable to auditors themselves. Similarly, the very nature of audited financial statements ‑‑ produced, as they are, by professionals whose reputations (and, thereby, whose livelihoods) are at stake ‑‑ will very often mean that any of those people would act wholly reasonably in placing their reliance on such statements in conducting their affairs.²¹

The decision goes on:

In light of these considerations, the reasonable foreseeability/reasonable reliance test for ascertaining a prima facie duty of care may well be satisfied in many (even if not all) negligent misstatement suits against auditors and, consequently, the problem of indeterminate liability will often arise.²²

[Emphasis added]

20The fact that the “problem...will often arise” does not suggest that, in the case that Mr. Justice Grace was asked to decide, the concern for an indeterminate liability has been shown to exist such that it is plain and obvious that it would serve to negate any prima facie recognition of a duty of care.

21The second of the three cases to which Mr. Justice Grace was referred was Cooper v. Hobart.²³ Investors who had provided funds to a mortgage broker alleged that it had used the money for unauthorized purposes. A lawsuit was commenced naming as defendant, the Registrar of Mortgage Brokers, a statutory regulator. It was said that he owed a duty of care to the investors, that he was aware of serious violations committed by the broker and should have acted earlier to suspend its license. The Supreme Court of Canada observed that this appeal “...revisits the Anns test...and, in particular, highlights and hones the role of policy concerns in determining the scope of liability for negligence”.²⁴

22The case provides assistance as to where the line between stage 1 and stage 2 of the “Anns test” is drawn:

It is established that government actors are not liable in negligence for policy decisions, but only operational decisions. The basis of this immunity is that policy is the prerogative of the elected Legislature. It is inappropriate for courts to impose liability for the consequences of a particular policy decision. On the other hand, a government actor may be liable in common negligence for the manner in which it executes or carries out the policy.²⁵

23The Supreme Court of Canada determined that the case failed to satisfy stage 1 of the “Anns test”, the proximity necessary to establish a prima facie duty of care was not present. There was no need to proceed to the second branch of the test. Nonetheless, the court did comment and raised the question of indeterminate liability. It said:

Further the spectre of indeterminate liability would loom large if a duty of care was recognized as between the Registrar and investors in this case. The Act itself imposes no limit and the Registrar has no means of controlling the number of investors or the amount of money invested in a mortgage brokerage system.²⁶

[Emphasis added]

24Quite apart from the question of whether these remarks are obiter dicta is the more obvious concern that they speak to the particular case and legislation. The fact that there is a “spectre of indeterminate liability” in one case does not mean it is present in another such that it becomes “plain and obvious” that the claim of the plaintiff cannot succeed.

25The third case that was given to Mr. Justice Grace was R. v. Imperial Tobacco Canada Ltd.²⁷ This appeal actually concerns two cases dealing with, on the one hand, an effort by the province of British Columbia to collect, from a group of tobacco companies, the costs of medical treatment of individuals suffering from tobacco-related illnesses and, on the other, a class action brought against only Imperial Tobacco. The class consisted of consumers of light or mild cigarettes. The action alleged that Imperial Tobacco engaged in deceptive practices when it promoted low-tar cigarettes as less hazardous to the health of consumers.

26In both cases, the tobacco companies issued third party notices to the Government of Canada, claiming that if the tobacco companies were held liable to the plaintiffs, they would be entitled to compensation from the Government of Canada for, among other things, negligent misrepresentation. The Government brought motions to strike the third-party notices, arguing that it was plain and obvious that the third-party claims failed to disclose a reasonable cause of action. In both cases, the “chambers judges” struck all of the third-party notices. The British Columbia Court of Appeal allowed the appeals of the tobacco companies, in part.

27The Supreme Court of Canada applied the “Anns test”. In considering the first stage of the test, the court found that there was no prima facie duty of care owed by the Government of Canada to individual consumers. On this basis, in the class-action, the third-party notice was struck. With respect to the action brought by the Government of Canada against the tobacco companies, the court found that the government did owe a prima facie duty to the tobacco companies. Nonetheless, the third-party notice was struck because the representations were expressions of government policy developed out of concern for the health of Canadians and the costs associated with tobacco-related disease and directed to encouraging people who continued to smoke to switch to low-tar cigarettes. This being so, it was not necessary to consider whether the prospect of an indeterminate liability provided another policy reason for negating the prima facie presence of a duty of care. Despite this, in view of the fact that the issue had been fully argued, the court did comment. It noted:

I agree with Canada that the prospect of indeterminate liability is fatal to the tobacco companies' claims of negligent misrepresentation. Insofar as the claims are based on representations to consumers, Canada had no control over the number of people who smoke light cigarettes. This situation is analogous to Cooper, where this court held that it would have declined to apply a duty of care to the Registrar of Mortgage Brokers in respect of economic losses suffered by investors because ‘[t]he Act itself imposes no limit and the Registrar has no means of controlling the number of investors or the amount of money invested in the mortgage brokerage system’. While this statement was made in obiter, the argument is persuasive.²⁸

28This case, like the others, does not conflict with the decision of Mr. Justice Grace. It is a case decided on its own particular facts. It raises the prospect of the presence of an indeterminate liability, but does not give any cause to accept that it is plain and obvious that it would apply to this case to negate a prima facie duty of care.

29In her submissions, counsel for the defendant referred to a fourth case, Pfeiffer v. Ontario.²⁹ Unlike the others, it does refer to actions taken by FRO. There was an order made by the court requiring that child support be paid. It was accompanied by a “support deduction order”. Pursuant to that order, FRO commenced to garnishee the wages of the payor. Orders were made suspending payment of the arrears that had been collected and removing the right of FRO to garnishee the wages. FRO continued to receive payments from the employer of the payor. In time, the orders removing the right to garnishee the wages were set aside. The payor commenced an action against FRO. The Crown, the defendant in the action, moved to strike the claim as disclosing no cause of action (see: Rule 21.01(1)(b) of the Rules of Civil Procedure). This was not a motion for summary judgment. The court found there was no evidence the support order was ever stayed and that “...it [was] plain and obvious and beyond doubt that the plaintiff cannot show that the Director wrongfully garnished [sic] his wages”.³⁰ To be successful, the payor would have to establish that FRO owed him a duty of care giving rise to liability for negligence in damages for any losses he sustained. This would require a determination by the court that the circumstances disclosed reasonably foreseeable harm and proximity sufficient to establish a prima facie duty of care. The court determined that the case did not fall within and was not analogous to a category of cases in which a duty of care had previously been recognized. It went on to observe that “...the statute does not impose a duty of care on the Director to make sure payors can afford the support ordered”.³¹ There was no prima facie duty of care. Despite this, as in Cooper v. Hobart and in R. v. Imperial Tobacco Canada Ltd., the court went on to consider whether there was any residual policy consideration that would justify denying liability:

…In my view, even if a prima facie duty of care was established it would be negated at this second stage for overriding policy reasons. As stated earlier, the purpose behind the Family Responsibility and Support Arrears Enforcement Act is to ensure that support orders and support deduction orders are paid in a timely fashion. As the court held in Cooper v. Hobart at para. 54 and page 560, ‘a spectre of indeterminate liability would loom large if a duty of care were recognized…’ as between the Director of the Family Responsibility [Office] and all the thousands [sic] unnamed payors.³²

30Again, the reference to an indeterminate liability was outside the consideration which determined the decision that was made (obiter dicta). In that case, the issue concerned those obliged to pay, not, as here, those who were to receive the support payments.

31Finally, with respect to Pfeiffer v. Ontario, I should note that the court did refer to the duty owed as being to the public at large. To my mind, this observation does not detract from the possibility of a separate private duty being owed to a single individual. Mr. Justice Grace offered the following:

F.R.O. employs personnel for the specific purpose of enforcing support orders. They have – or should have – expertise in that area. Those in the private sector who enforce monetary orders owe their clients a duty of care. Absent a statutory provision to the contrary, should the Crown be immune because the service is publically funded? ³³

32If the answer is “no”, there will be a duty of care owed by FRO to individuals, on whose behalf it is enforcing support orders, that reaches beyond the general duty to the public at large.

33As it is, these cases do not conflict with the order of Mr. Justice Grace. Nor do they demonstrate that there is reason to doubt that the correctness of his decision. To this point in the analysis, the issues raised are genuine and require a trial.

34The defendant submitted that there is another reason to doubt the correctness of the decision of the motions judge. As counsel for the defendant sees it, his decision regarding the prospect of an indeterminate liability reflects a concern for the number of cases that will be raised when it should be concerned with the number of orders that are registered with FRO and the value of the liabilities that could accrue. In his reasons, Mr. Justice Grace quoted from Hill v. Hamilton-Wentworth Regional Police Services Board³⁴, as follows:

Courts are not in the business of second-guessing reasonable exercises of discretion by trained professionals. An appropriate standard of care allows sufficient room to exercise discretion without incurring liability in negligence. Professionals are permitted to exercise discretion. What they are not permitted to do is to exercise their discretion unreasonably. This is in the public interest.³⁵

The judge went on and wrote:

I agree. The issues raised by Ontario on this motion can be considered in determining whether the standard of care has been met. Importantly, the record is devoid of evidence to suggest that lawsuits will abound if a duty of care is imposed...³⁶

35In saying this, the motions judge was not simply reviewing the number of cases that may arise as a consideration that reflects on the concern that there may be an indeterminate liability. Instead, he was making the observation that any potential liability would be circumscribed by the breadth of the discretion available to the employees of FRO. FRO would not be vulnerable to unconstrained litigation. This claim arose:

…[not] because F.R.O. declined to enforce the support order but because of a problematic decision made in extraordinary circumstances during the course of enforcement.

36Mr. Justice Grace was not prepared to find there could be no duty of care owed by FRO to the plaintiffs.³⁷

37In substance, he determined that the question of whether there was any residual policy considerations that would negate a finding of a prima facie duty of care owed by FRO to the plaintiffs was a genuine issue requiring a trial. There is no reason to doubt the correctness of this decision.

38It follows that I will not order leave to appeal the refusal of Mr. Justice Grace to find that there can be no duty of care owed by FRO to the plaintiffs and, on that basis, to grant summary judgment and dismiss the plaintiff’s claim for negligence.

Fiduciary Duty

39I turn now to the allegation that FRO breached a fiduciary duty it owed the plaintiffs. It was submitted, on behalf of FRO, that it owes no fiduciary duty. This was included in the motion for summary judgment. Mr. Justice Grace dealt with the submission, as follows:

In light of my conclusion with respect to the negligence claim, I do not propose to address the issue of whether Ontario owed or breached a fiduciary duty at length. Suffice to say that the question of whether Ms. Ashak can satisfy the requirements articulated in Alberta v. Elder Advocates of Alberta Society should be determined at trial.³⁸

40In saying this, the motions judge was relying on his finding that, in any event, there would be a trial. On this basis, he was able to deal with the claim for breach of fiduciary duty as briefly as he did. At its core, the decision of the motions judge is a determination that whether FRO owes a fiduciary duty to the plaintiffs is a genuine issue which requires a trial to resolve. To paraphrase the words of Combined Air Mechanical v. Flesch, the full appreciation required to make dispositive findings in respect of this question can only be achieved by way of a trial.³⁹

41The defendant says that this decision conflicts with “a decade’s worth of Ontario jurisprudence where claims for fiduciary duty against the crown have been routinely dismissed at the pleadings stage”.⁴⁰ It referred in particular to the case noted by the motions judge, Alberta v. Elder Advocates of Alberta Society. ⁴¹

42Certainly, that case establishes that it is rare for the Crown to be a fiduciary but it is not impossible. ⁴² In a given case, perhaps in most cases, it may be clear that no fiduciary duty can be present, but it will not always be so. It may require a trial to fully understand the facts on which the claim is based. In such circumstances, it cannot be said that, for the purpose of a motion for summary judgment, a conflict with Alberta v. Elder Advocates of Alberta Society has been established.

43On this motion, was there a demonstrated conflict with this, or other cases? Is there reason to doubt the decision of the motions judge?

44The fiduciary relationship is one in which a party is required to act in the best interests of another. A fiduciary relationship has been defined as:

A relationship in which one person is under a duty to act for the benefit of another on matters within the scope of the relationship.⁴³

and, as follows:

The critical feature of these relationships is that the fiduciary undertakes or agrees to act for or on behalf of or in the interests of another person in the exercise of a power or discretion which will affect the interests of that other person in a legal or practical sense.⁴⁴

45Where there is a fiduciary duty, one must act in the interests of another even to the detriment of one’s own interest:

Having found that the parties were in a fiduciary relationship, Prowse J. turned to the scope of the fiduciary duties owed by Mr. Simms to Mr. Hodgkinson. She once again cited the Hospital Products case, at pp. 169-70, here for the proposition that a fiduciary ‘is under an obligation not to promote his personal interest by making or pursuing a gain in circumstances in which there is a conflict...between his personal interests and those of the person whom he is bound to protect’.⁴⁵

46Alberta v. Elder Advocates of Alberta Society provides that, to establish a fiduciary relationship, in addition to the vulnerability of the beneficiary to the fiduciary which is inherent, the claimant must show: (1) an undertaking by the alleged fiduciary to act in the best interests of the alleged beneficiary; (2) a defined person or class of persons vulnerable to a fiduciary's control (the beneficiary); and (3) a legal or substantial practical interest of the beneficiary that stands to be adversely affected by the alleged fiduciary’s exercise of discretion or control.⁴⁶

1) The undertaking by the fiduciary

47Alberta v. Elder Advocates of Alberta Society acknowledges that the undertaking, where the government is involved, may arise from statute or by implication through the relationship between the parties.⁴⁷ If it is by statute: “...A thorough examination of the provisions in issue is mandatory”.⁴⁸

48With this in mind, I note that:

• The clerk or registrar of the court that makes a support order is required to file it with the office of the Director of FRO promptly after it is signed.⁴⁹

• Once filed, it is the duty of the Director to enforce support orders and to pay the amounts collected to the person to whom they are owed.⁵⁰

• Generally, no person other than the Director of FRO shall enforce a support order that is filed in the Director’s office.⁵¹

• Among the reasons the Director may refuse to enforce an order is when the recipient repeatedly accepts payment of support directly from the payor.⁵²

• The Director of FRO, in enforcing an order may take steps in the name of the Director but does so for the benefit of the recipients under the order.⁵³

49What these program characteristics suggest is that the Director takes on the responsibility to enforce the support order on behalf of and for the benefit of the recipient. On this basis, it may be that there is a statutorily-imposed undertaking. Whether there is anything which, through the relationship of the parties, would, by implication, add to this understanding cannot be fully appreciated at this stage. The thrust of the decision of Mr. Justice Grace is that this and the other requirements raised in Alberta v. Elder Advocates of Alberta Society should be determined at a trial.

2) The defined person or class of persons vulnerable to a fiduciary’s control

50In Alberta v. Elder Advocates of Alberta Society, the court observed that “[n]o fiduciary duty is owed to the public as a whole, and an individual determination is required to establish that the fiduciary duties owed to a particular person or group.”⁵⁴ In this case, the question is whether there is a duty that is or may be owed to the recipients under the FRSAEA and whether the plaintiffs, given their relationship to FRO, were beneficiaries of that duty. The decision made by Mr. Justice Grace found that this requirement should be determined at trial.

3) The legal or substantial practical interest of the beneficiary

51Finally, Alberta v. Elder Advocates of Alberta Society acknowledges that: “...it may be difficult to establish the requirement that the government power attacked affects a legal or significant practical interest, where the alleged fiduciary is the government”. The decision goes on to say that “[t]he interest affected must be a specific private law interest to which the person has a pre-existing distinct and complete legal entitlement”.⁵⁵ Mr. Justice Grace saw this as something akin to a private law duty. People in the private sector who enforce monetary orders owe their clients a private duty. The motions judge wondered why this would be different just because the service is publicly-funded.⁵⁶ His decision dictates that this determination should be left to trial.

52The import of the decision of Mr. Justice Grace is that it is not plain and obvious that there can be no fiduciary duty owed by FRO to the plaintiffs. A trial is required. His decision does not conflict with Alberta v. Elder Advocates of Alberta Society.

53The findings I have made dictate that, with respect to the issues dealt with by the submissions I have heard, the motion be dismissed and leave to appeal be refused.

The Procedural Problem: Part 2

54This takes me back to where I started. I have heard no submissions and made no finding with respect to any appeal that may be made, or leave to appeal that could have been sought, with respect to whether there has been a demonstration of a prima facie duty of care. As I said at the outset, to my mind, there is no right to appeal this part of the reasons of Mr. Justice Grace to the Court of Appeal. At the same time, leave was not sought. Given the decision I have made, it seems that the defendant will have two options:

1. Proceed to the Court of Appeal and test whether it is prepared to hear the appeal as brought; or,
2. Proceed to trial.

55I say this mindful that the defendant may yet seek leave to appeal the outstanding issue, but doubtful that it is appropriate to split motions for leave as this would require and concerned for what would be gained, given the need for a trial that will remain.

56With respect to the latter of the two approaches referred to, I anticipate there will be a concern that the trial judge will find the issue of whether there is a prima facie duty of care to be res judicata. Obviously, this is something to be decided by the trial judge. However, given the concerns these reasons may raise, it may be as well if I make some comment in the hope that this may assist in avoiding a procedural morass and facilitate a speedier resolution of the action. Where an order for summary judgment is made, it finally determines the issues between the parties and gives rise to a plea of res judicata in subsequent proceedings.⁵⁷ In circumstances where, as here, a motion seeking summary judgment is dismissed, the order is interlocutory. The only determination that may be subject to res judicata is that there is a genuine issue requiring a trial. The underlying issues in the action have not been finally determined and do not raise issues of res judicata or issue estoppel.⁵⁸

57In this case, Mr. Justice Grace was not asked to and did nothing other than dismiss the motion. I repeat what I quoted earlier, having dealt with the issue of whether there was a prima facie duty of care, he wrote: “This aspect of the analysis is not complete”⁵⁹. He went on to the second stage of the “Anns test” and, in the end, determined that he could not grant summary judgment. If, as the order suggests, this is a single conclusion made after taking into account both aspects of the “Ann’s test”, it may be that any determination ­­­made by Mr. Justice Grace, as to the presence of a prima facie standard of care, is not subject to res judicata. Again, this would be for the trial judge to decide.

Conclusion

58Insofar as the motion before me is concerned, it is dismissed.

Costs

59The parties advised the court that they had agreed as to costs. In the event that the plaintiffs were successful, they were to be awarded costs in the amount of $8,376.78. Accordingly, I award costs to the plaintiff in that amount.

Footnotes

1. 1S.O. 1996, c. C. 31.
2. 2R.S.C., 1985, c. 4 (2nd Supp.).
3. 3FRSAEA, at ss. 9, 12-14.
4. 4FRSAEA, at ss. 5, 6 and 7.
5. 5FOAEA, at s. 67.
6. 6[1978] A.C. 728.
7. 7Hill v. Hamilton-Wentworth Regional Police Service Board, 2007 SCC 41, [2007] 3 S.C.R. 129, at para. 20, as referred to in Ashak v. Ontario (Director, Family Responsibility Office), 2012 ONSC 1909, at para. 42.
8. 8Ashak v. Ontario (Director, Family Responsibility Office), see: note 7, at para. 71.
9. 9Hill v. Hamilton-Wentworth Regional Police Service Board, see: note 7, at para. 20.
10. 10Ashak v. Ontario (Director, Family Responsibility Office), see: note 7, at para. 88.
11. 11Notice of Motion for Leave to Appeal, at para. 5.
12. 12Ashak v. Ontario (Director, Family Responsibility Office), see: note 7, at para. 92, relying on Combined Air Mechanical Services Inc. v. Flesch 2011 ONCA 764, Note 25, at para. 50.
13. 13Motion Record of the Defendant, Date: February 13, 2012, at Tab 1.
14. 14Kawartha Lakes (City) v. Gendron et al, 2012 ONSC 2035; and see also: Oak Incentives Group Inc. v. The Toronto Dominion Bank, 2010 ONSC 6976, at para. 10; and Louie Mazzon and Fennell Property Management Ltd. v. Wentworth Condominium Corporation No. 102, 2011 ONSC 6036, at para. 14.
15. 15Hercules v. Ernst & Young, [1997] 2 S.C.R. 165, at para. 32; Cooper v Hobart, 2001 SCC 79, [2001] 3 S.C.R. 537, at para. 53; and, R. v. Imperial Tobacco Canada Ltd,. 2011 SCC 42, [2011] 3 S.C.R. 45, at para. 99.
16. 16Ashak v. Ontario (Director, Family Responsibility Office), see: note 7, at para. 84, quoting the Factum of the defendant filed before Grace J.
17. 17Ashak v. Ontario (Director, Family Responsibility Office), see: note 7, at para. 85.
18. 18Ashak v. Ontario (Director, Family Responsibility Office), see: note 7, at para. 85, and FRSAEA note 1, at s. 7(1) (k).
19. 19See: note 14.
20. 20Hercules v. Ernst & Young, see: note 14, at para. 42.
21. 21Hercules v. Ernst & Young, see: note 14, at para. 32.
22. 22Hercules v. Ernst & Young, see: note 14, at para. 32.
23. 23see: note 14.
24. 24Cooper v. Hobart, see: note 14, at para. 1.
25. 25Cooper v. Hobart, see: note 14, at para. 38.
26. 26Cooper v. Hobart, see: note 14, at para. 54.
27. 27See: note 14.
28. 28R. v. Imperial Tobacco Canada Ltd., see: note 15, at para. 99.
29. 29[2006] O.J. No. 3854.
30. 30Pfeiffer v. Ontario see: note 26, at para. 27.
31. 31Pfeiffer v. Ontario see: note 26, at para. 37.
32. 32Pfeiffer v. Ontario see: note 26, at para. 40.
33. 33Ashak v. Ontario (Director, Family Responsibility Office), see: note 7, at para. 86.
34. 34See: note 7.
35. 35Hill v. Hamilton- Wentworth Regional Police Services Board, see: note 7, at para. 54, per McLachlin C.J. quoted at Ashak v. Ontario (Director, Family Responsibility Office), see: note 7, at para. 87.
36. 36Ashak v. Ontario (Director, Family Responsibility Office), see: note 7, at para. 88.
37. 37Ashak v. Ontario (Director, Family Responsibility Office), see: note 7, at para. 88, and see note 10.
38. 38Ashak v. Ontario (Director, Family Responsibility Office), see: note 7, at para. 93.
39. 392011 ONCA 764, [2011] O.J. No. 5431; 108 O.R. (3d) 1, at para. 50.
40. 40Factum of the Moving Party, at para. 43.
41. 412011 SCC 24, [2011] S.C.J. No. 24.
42. 42Alberta v. Elder Advocates of Alberta Society see: note 41, at paras. 37, 48 and 54.
43. 43Black’s Law Dictionary, Eighth Edition, at 1315, as quoted in Bluefoot Ventures Inc. v. Ticketmaster (Citysearch), at para. 20.
44. 44Hospital Products Ltd. v. United States Surgical Corp. (1984), 55 A.L.R. 417, at p. 454, quoted in Hodgkinson v. Simms, (1989), 43 B.L.R. 122 (B.C.S.C.), at p. 164; and in Bluefoot Ventures Inc. v. Ticketmaster (Citysearch), at para. 20.
45. 45Hodgkinson v. Simms, [1994] 3 S.C.R. 377, at pp. 400-1; and in Bluefoot Ventures Inc. v. Ticketmaster (Citysearch), at para. 21.
46. 46Alberta v. Elder Advocates of Alberta Society see: note 41, at para. 36.
47. 47Alberta v. Elder Advocates of Alberta Society see: note 41, at paras. 45 and 46.
48. 48Alberta v. Elder Advocates of Alberta Society see: note 41, at para. 45.
49. 49FRSAEA, at s. 12(1).
50. 50FRSAEA, at s. 5(1).
51. 51FRSAEA, at ss. 4 and 6(7).
52. 52FRSAEA, at s. 7(1)(h).
53. 53FRSAEA, at s. 6(1).
54. 54Alberta v. Elder Advocates of Alberta Society see: note 41, at para. 50.
55. 55Alberta v. Elder Advocates of Alberta Society see: note 41, at para. 51.
56. 56Ashak v. Ontario (Director, Family Responsibility Office), see: note 7, at para. 86, and para. [51], above.
57. 57V.K. Mason Construction Ltd. v. Canadian General Insurance Group Ltd. (1998), 42 O.R. (3d) 618 (C.A.), at paras. 9 and 19.
58. 58Leone v. University of Toronto Outing Club, 2007 ONCA 323 (Ont. C.A.); Smith Estate v. National Money Mart Co., 2008 ONCA 746 (Ont. C.A.), at para. 30; Peleshok Estate v. Peleshok, 2011 ONSC 3156, at paras. 83-86 (Ont. S.C.J.).
59. 59Ashak v. Ontario (Director, Family Responsibility Office), see: note 7, at para. 71; and see: para. [9], above.