DATE: 20060222

DOCKET: C43544

COURT OF APPEAL FOR ONTARIO

RE:

THE TORONTO-DOMINION BANK (Applicant/Respondent in Appeal) v. MAGNOLIA TREE HOLDINGS INC. (Respondent/Appellant in Appeal)

BEFORE:

DOHERTY, MOLDAVER and JURIANSZ JJ.A.

COUNSEL:

Izaak De Rijcke

for the appellant

Troy H. Lehman and Kathryn L. Meehan

for the respondent

HEARD: February 16, 2006

RELEASED ORALLY: February 16, 2006

On appeal from the judgment of Justice J.F. McGarry of the Superior Court of Justice dated April 12, 2005 and from the supplementary cost order dated June 17, 2005.

E N D O R S E M E N T

[1] The application judge found that the lease gave the respondent (the “Bank”) the use of parking spaces, some of which could for all practical purposes be accessed only through the laneway owned by the landlord/appellant and situated immediately south of those parking spaces. Given this finding of fact, it was open to the application judge to conclude, consistent with the arrangement between the Bank and the appellant at the time they entered into the lease, that access to those parking spaces using the laneway immediately to the south of the spaces was an implied term of the lease. The appellant can successfully challenge that conclusion only if he can demonstrate that the finding of fact on which it is based is the product of clear and palpable error.

[2] There was ample evidence to support the application judge’s finding as described above. This argument must fail.

[3] We also reject the appellant’s res judicata argument. The finding of the application judge was based entirely on his interpretation of the lease and his finding that access to the parking spaces using the laneway to the south of those spaces was an implied term of the lease. Findings made in the prior litigation, while relevant to the Bank’s interest, if any, in the appellant’s land based on prior usage, had nothing to do with the lease, and had no relevance to the question of whether access to those parking spaces was an implied term of the lease.

[4] The appellant also relied on para. 7 of the lease. That paragraph addressed a possible situation that in fact never came to pass. It does not assist on the question of whether access to the parking spaces through that laneway to the south was a term to be implied in the lease signed by the parties.

[5] The appeal is, therefore, dismissed.

[6] The appellant also seeks leave to appeal the costs order. The application judge granted costs on a substantial indemnity basis. In doing so, he took a negative view of the appellant’s conduct describing it as “malevolent”. That finding was open to the application judge and it is not for this court to reassess the appellant’s conduct on a de novo basis. That finding fully justifies the imposition of costs on a substantial indemnity basis. Nor, in our view, is the quantum of costs awarded unreasonable. Consequently, we would refuse leave to appeal costs.

[7] The respondent should have its costs of the appeal on a partial indemnity basis in the amount of $10,000, inclusive of GST and disbursements.

“Doherty J.A.”

“M.J. Moldaver J.A.”

“R.G. Juriansz J.A.”