CITATION: Ontario Realty Corporation v. P. Gabriele & Sons Limited, 2009 ONCA 531
DATE: 20090630
DOCKET: M37391 C50052
COURT OF APPEAL FOR ONTARIO
MacFarland J.A. (In Chambers)
BETWEEN:
Ontario Realty Corporation and Her Majesty the Queen in right of the Province of Ontario as represented by the Attorney General
Plaintiffs/Respondents
And
P. Gabriele & Sons Limited, Gabbro Construction Ltd., Gabriel Environmental Services Inc., 1331679 Ontario Limited, Pierino Gabriele, Frank Angelo Gabriele, Antonio Gabriele, Sirman Associates Limited, Ivan A. Sirman, Progressive Environmental Inc., Cynthia D.I. Stiles, 1287512 Ontario Limited, Integrated Property Solutions Inc., Robert W. Allan, Environmental and Development Solutions Ltd., Richard C. Benson, 780551 Ontario Limited, c.o.b. Master Environmental Services, 1331989 Ontario Limited, 981602 Ontario Inc., c.o.b. Tri-Spade, Vincent Catalfo, Ross Farwell, Kent Banting, Tate Street Capital Inc., Poplar Oaks Land Development Corporation, Valley Ford Homes Inc., Mateus Village Inc., Valleyford Development Corporation, St. Stephen’s Estates Inc., McLevin Properties Ltd., Lawson Meadowvale Developments Inc., Rosebury Holdings Inc., Mayfair Electric Limited, Zenat Holdings Ltd., Nima Investments Inc., 1331237 Ontario Limited, c.o.b. Southeastern Environmental Services, Damian Spadafora, Mary Spadafora, Michael Zentil, Mauro Tonietto, Sandra Tonietto, John Perdue, John Perdue c.o.b. Legends Consulting, John Falcioni, New Belfrie Holdings Inc., Rosemary DiCarlo, Kleinfeldt Consultants Limited, 1022635 Ontario Inc., Stephen J. Blaney, H. Sutcliffe Limited, H. James Hawken, L & B Contracting, Larry D. Bellmore, Martindale Planning Services, and Robert Martindale
Defendants/Appellants
James Morton, for the appellants Falcioni and John Perdue
Ronald Carr, for the respondents
Heard: May 13, 2009
MacFarland J.A.
[1] The individual defendants John Falcioni and John Perdue move for an order striking the notice of cross-appeal delivered by the respondents. The moving parties state that they delivered no notice of appeal and that they were not brought into nor named a party to any other appeal brought by any other party. They submit that the notice of cross-appeal is a fresh appeal which was required to be commenced by delivery of a notice of appeal rather than a notice of cross-appeal.
[2] The respondents further submit that as the judgment of the trial court is dated January 23, 2009, the Rules require that any notice of appeal be delivered within 30 days of the date of judgment. The notice of cross-appeal was delivered March 5. If the moving parties are correct and a notice of appeal is required, rather than a notice of cross-appeal, the respondents are out of time and the appeal (now named a cross-appeal) should be struck.
[3] The action which gives rise to the issue raised was a complex one and was tried before Newbould J. over 18 days. His reasons for judgment were delivered January 23, 2009. The trial judge succinctly summarized the issues in the first three paragraphs of his reasons. I can do no better than to repeat them:
[1] This action arises from a number of contracts made by Ontario Realty Corporation (ORC) with corporations related to the defendant Frank Angelo Gabriele (Gabriele). One of the contracts involved an environmental clean up of a site. Six of the contracts involved sales by ORC to a Gabriele related corporation. The plaintiffs sue in fraud, conspiracy and unjust enrichment. The claims relate to alleged manipulation of bids for the purchase of the properties and the obtaining of unlawful price reductions for those properties. It is alleged that with respect to the environmental clean-up transaction, these were manipulated bids and the work contracted for was not done but billed and paid for by ORC.
[2] The statement of claim is lengthy, some 500 pages, and has been amended a number of times. There were many other transactions that were initially impugned but they have not been pursued. A number of individuals were sued, some of whom remain defendants and others who do not. Included in the personal defendants against whom claims are made are three former employees of ORC, Vincent Catalfo, John Perdue and John Falcioni. The other remaining personal defendants are business partners of Gabriele or persons involved with related corporations.
[3] One of the sale transactions in issue involved a property in Aurora. The transaction did not close. The purchaser, P. Gabriele & Sons Limited (Gabriele Ltd.), has counterclaimed for damages for an alleged breach by ORC of the agreement of purchase and sale resulting from its failure to close the transaction.
[4] The appellants Frank Angelo Gabriele, Rosebury Holdings Inc., Michael Zentil and Mauro Tonietto appeal from the judgment of the trial court and in their notice of appeal ask:
that the judgment be set aside FOR THE MOST PART and that judgment be granted in favour of the Appellants
[5] Their notice of appeal was delivered February 19, 2009, well with the 30 day time limit for the filing of an appeal.
[6] The notice of cross-appeal was delivered by the respondents March 5, 2009 and asks that the judgment be varied as follows:
(1) Judgment for damages in the amount $300,000 together with interest and costs be granted against the defendant, John Falcioni (Falcioni) in respect of the transaction known as Brittania/Tourkin;
(2) Judgment for damages in the amount of $291,861.20 together with interest and costs be granted against the defendant, John Perdue (Perdue) in respect of the transaction known as Bowmanville; and
(3) Judgment for damages in the amount of $216,500 together with interest and costs be granted against the defendant, John Perdue in respect of the transaction known as Bowmanville;
[7] No relief is claimed in relation to any of the appellants named in the notice of appeal delivered February 19, 2009. In these circumstances, where the cross-appeal is irrelevant to and does not involve the parties bringing the appeal, the moving parties submit, that the respondents ought to have delivered a notice of appeal rather than a notice of cross-appeal.
[8] Cross-appeals are governed by rule 61.07 and it provides:
CROSS APPEALS
61.07 (1) A respondent who,
(a) seeks to set aside or vary the order appealed from; or
(b) will seek, if the appeal is allowed in whole or in part, other relief or a different disposition than the order appealed from,
shall within 15 days after service of the notice of appeal serve a notice of cross-appeal (Form 61E) on all parties whose interests may be affected by the cross-appeal and on any person entitled by statute to be heard on the appeal, stating the relief sought and the grounds of the cross-appeal.
(l.l) A respondent may, subject to subrule (1.2) serve a notice of cross-appeal without obtaining leave to appeal for the cross-appeal if,
(a) there is an appeal as of right; or
(b) leave to appeal has been granted.
(1.2) The respondent shall obtain leave to appeal in the manner provided by subrule 61.03(8) or 61.03(18), as the case may be, if the cross-appeal is taken under,
(a) clause 133(b) of the Courts of Justice Act; or
(b) another statute that requires leave for an appeal.
(2) The notice of cross-appeal, with proof of service, shall be filed in the office of the Registrar within ten days after service.
(3) Where a respondent has not delivered a notice of cross-appeal, no cross appeal may be heard except with leave of the court hearing the appeal.
[9] In my view a plain reading of the rule suggests that the respondents are within their right and entitled to deliver a notice of cross-appeal. There is nothing in the rule that requires that the subject of the cross-appeal must relate to the appeal. Nor is there any requirement that the only responding parties to the cross-appeal must be the appellants.
[10] The language of rule is broad. The respondents to the appeal are Ontario Realty Corporation and Her Majesty the Queen in right of the Province of Ontario as represented by the Attorney General. They are the responding parties to the notice of appeal delivered February 19, 2009 and they seek to vary the judgment appealed from and thus are within rule 61.07(1)(a).
[11] While not directly dispositive of the precise point raised on this motion, in my view the decision of this court in Sigesmond v. Royal College of Dental Surgeons of Ontario, (2006) O.J. No. 3334 is powerfully persuasive.
[12] The issue is Sigesmond arose in the circumstances of an appeal from an order of the Divisional Court in a professional misconduct case. Dr. Sigesmond had been charged with seven counts of professional misconduct by the College. The Discipline Committee found him guilty on all counts. The doctor’s appeal to the Divisional Court was allowed in respect of four of the counts but was dismissed in relation to the other three counts. The College was granted leave to appeal the order of the Divisional Court by this court February 13, 2006 and served Dr. Sigesmond with notice of appeal February 15, 2006. On March 2, 2006 Dr. Sigesmond served the College with a notice of cross-appeal. The College, by way of appeal, sought to restore the Discipline Committee’s conviction of Dr. Sigesmond on all counts of professional misconduct while Dr. Sigesmond sought to set aside the conviction on all counts. The College moved for an order to quash Dr. Sigesmond’s cross-appeal on the basis that Dr. Sigesmond required leave to appeal. This court concluded that Dr. Sigesmond did not require leave to cross-appeal and dismissed the motion to quash.
[13] The basis for the College’s motion was its position that Dr. Sigesmond required leave to appeal because the issues he raised in his notice of cross-appeal were not the same as those the College raised in its appeal. The College’s submission was that Dr. Sigesmond had to obtain leave to appeal because he alleged different errors by the Divisional Court in respect to issues other than those raised by the College in its notice of appeal. The argument, if not identical, is very similar to the position taken by the moving appellants in this case.
[14] The reasons of Borins J.A. writing for this court are most helpful. At paragraph 10:
Doctrinally, an appeal is taken from the order or judgment of the court. In some proceedings, the court’s order may resolve more than one issue, as in this appeal. Sometimes, and this appeal is a prime example, success in the court below is divided. As a result of Dr. Sigesmond’s appeal to the Divisional Court, some of his convictions were set aside, while others were sustained. The College was first off the starting line and obtained leave to appeal to restore the findings of guilt against Dr. Sigesmond that were set aside. However, the opposite could have taken place, and Dr. Sigesmond could have been the first party to obtain leave to appeal. Thus, had the circumstances been the reverse, there is no doubt that the Collge would have wanted to proceed with its appeal, but in these circumstances, by cross-appeal. In my view, it would undoubtedly have done so in reliance on rule 67.07(1.1)(b). It would not have sought leave to appeal.
Obviously, there can be a cross-appeal only if there is an appeal. Although each party could commence a separate appeal in such circumstances, the provisions of Rule 61 enable the parties to avoid separate proceedings by permitting the respondent to commence a cross-appeal. This is a mechanism directed to the simplification of proceedings, avoidance of multiple proceedings, judicial economy and the reduction of litigation expenses for the parties. As such, a cross-appeal is similar to a counterclaim and a third party claim. In most cases, a party may appeal as of right. In other cases, such as this appeal, the intended appellant must obtain leave to appeal. Provided that there is an appeal as of right or leave to appeal has been granted, rule 61.07(1.1) permits a respondent to serve a notice of cross-appeal. The only exceptions are found in rule 61.07(1.2) which requires the respondent to obtain leave to cross-appeal if the cross-appeal is in respect of costs, or leave to appeal is required by a statute other than the CJA.
In summary, rule 61.07(1.1)(b) expressly states that leave to appeal is not required to serve a notice of cross-appeal if leave to appeal has been granted. In this case, the respondent was granted leave to appeal. Nowhere in Rule 61.67 does it state, as the College contends, that a respondent is required to obtain leave to appeal if the cross-appeal relates to a different issue or a different part of the order or which leave to appeal has been granted. Logically, almost invariably a cross-appeal will be based on a different error in the court below than that on which the appeal is based. Moreover taken to its logical conclusion, if the College is correct, there could now be a cross-appeal, with or without leave, on any issue different from the issue raised by the appeal.
[15] In my view the comments of Borins J.A. are equally applicable to the issue raised on this motion. A notice of cross-appeal will be appropriate where the issues raised on the cross-appeal are different from those raised on the appeal and where the parties to the cross-appeal may be different from the appellants. In my view, it is merely a logical extension that where different issues are raised on the cross-appeal so too may the parties to that cross-appeal be different and particularly so in a case involving multiple parties.
[16] For these reasons the motion is dismissed.
RELEASED: June 30, 2009 “J. MacFarland J.A.”