Court of Appeal for Ontario

Date: January 20, 2017

Docket: C62010

Judges: Juriansz, Benotto and Brown JJ.A.

Parties

Between

Avie Cook Plaintiff (Respondent)

and

Ronald V. Joyce Defendants (Appellant)

Counsel

Peter J. Osborne and Chris Kostopoulos, for the appellant

Avie Cook, acting in person

Hearing

Heard: October 13, 2016

On appeal from: The order of Justice Paul M. Perell of the Superior Court of Justice, dated March 30, 2016, with reasons reported at 2016 ONSC 2164.

Decision

Brown J.A.:

OVERVIEW

[1] The respondent, Avie Cook, sues the appellant, Ronald Joyce, seeking damages for an alleged sexual assault. Ms. Cook alleges Mr. Joyce touched her in a sexual manner without her consent on the morning of May 19, 2011 at his home. As well, Ms. Cook alleges Mr. Joyce slandered her by telling others her complaints of a sexual assault were false.

[2] Mr. Joyce defends the action on several grounds: (i) he denies sexually assaulting Ms. Cook; (ii) he contends the parties settled Ms. Cook's sexual assault allegations in 2011, before she started the present 2013 action; (iii) he takes the position her sexual assault claim is barred by the two-year prescription period in the Limitations Act, 2002, S.O. 2002, c. 24, Sched. B (the "Act"); and (iv) he pleads the statements he made to others about Ms. Cook were true.

[3] Mr. Joyce moved for summary judgment dismissing Ms. Cook's action. The motion judge granted the motion in part, dismissing Ms. Cook's action for slander. However, the motion judge refused to dismiss the sexual assault claim, for three reasons.

[4] First, the motion judge held Mr. Joyce had not proved the parties settled Ms. Cook's sexual assault claim in late 2011 and early 2012. In addition to dismissing that part of Mr. Joyce's summary judgment motion based on his settlement defence, the motion judge granted partial summary judgment to Ms. Cook dismissing Mr. Joyce's settlement defence.

[5] Second, the motion judge concluded the discoverability date for Ms. Cook's claim under the Act was June 21, 2011, when she first met a lawyer to discuss her claim. As a result her May 31, 2013 sexual assault action was not statute-barred. He went on to grant partial summary judgment to Ms. Cook dismissing Mr. Joyce's limitation period defence.

[6] Finally, the motion judge concluded the enactment of the Sexual Violence and Harassment Action Plan Act (Supporting Survivors and Challenging Sexual Violence and Harassment), 2016, S.O. 2016, c. 2 (the "Amending Act") following the hearing of the summary judgment motion had the effect of removing any limitation period for Ms. Cook's sexual assault claim unless hers was a proceeding that "was settled by the parties and the settlement is legally binding." In light of his conclusion the parties had not settled the proceeding, the motion judge held no limitation period applied to Ms. Cook's sexual assault claim.

[7] For the reasons that follow, I would allow Mr. Joyce's appeal and set aside the motion judge's finding that the parties did not settle the action – his conclusion rested on palpable and overriding errors of fact and a palpable and overriding error in applying the law to the facts.

[8] Mr. Joyce asks this court to substitute a finding that the parties in fact settled Ms. Cook's sexual assault claim. Given the significant credibility disputes on material issues in this proceeding, including whether the parties reached an oral settlement agreement, this is not an appropriate case for this court to exercise its fact-finding powers under s. 134(4) of the Courts of Justice Act, R.S.O. 1990, c. C.43. I conclude a genuine issue requiring a trial exists as to whether the parties settled Ms. Cook's sexual assault claim. I would direct that claim proceed to trial.

[9] I would also grant Ms. Cook's request to set aside the dismissal of her slander claim.

THE STRUCTURE OF THESE REASONS

[10] These reasons are divided into four parts. Part I examines the Amending Act and explains why review of the motion judge's limitation period analysis should focus on whether Ms. Cook's proceeding "was settled by the parties and the settlement is legally binding." Part II explains how the motion judge erred in his analysis of whether the parties had reached a settlement. Part III then considers the remedial options available to this court and explains why the sexual assault claim should proceed to trial. Finally, Part IV considers the motion judge's dismissal of Ms. Cook's slander claim.

PART I: THE LIMITATIONS ACT ISSUE

A. The issue stated

[11] Before the motion judge, Mr. Joyce argued Ms. Cook's sexual assault action was statute-barred. He contended she discovered her claim on the day of the alleged assault, May 19, 2011, but did not issue a notice of action until May 31, 2013 – more than two years after the alleged assault.

[12] A change in the law complicated Mr. Joyce's limitation period argument. He initiated his summary judgment motion in June, 2015. The motion judge heard the motion on February 23 and 24, 2016. He reserved his decision. The Amending Act came into force on March 8, 2016. The motion judge released his reasons on March 30, 2016.

[13] The motion judge dismissed the motion, rejecting the appellant's limitations defense. He held that Ms. Cook did not gain a substantial awareness of the harm she had suffered until she spoke with a lawyer, Michael Miller of the Dickinson Wright LLP firm, on June 21, 2011. The two-year limitation period did not start to run until that date, with the result that Ms. Cook's May 31, 2013 action was not statute-barred. As well, the motion judge held no limitation period applied to Ms. Cook's sexual assault claim by reason of the enactment of the Amending Act.

[14] On this appeal, Mr. Joyce advances two arguments. First, he submits the changes the Amending Act made to s. 16 of the Limitations Act, 2002 should not apply to this proceeding. He argues a change in the law made while a decision is under reserve should not prejudice a party, in accordance with the principle of actus curiae neminem gravabit, or "what the court does ought not to prejudice a litigant." Mr. Joyce contends the motion judge improperly failed to exercise his discretion to grant an order nunc pro tunc so that his reasons "spoke" from the date of the hearing, prior to the enactment of the Amending Act.

[15] Second, Mr. Joyce renews his submission that Ms. Cook discovered her claim no later than May 27, 2011, when she first contacted the Dickinson Wright law firm, so her action is statute-barred.

B. Analysis

[16] I would not accept Mr. Joyce's submissions.

[17] The Amending Act contains clear provisions that foreclose the granting of an order nunc pro tunc. As I will explain, the new limitation-free regime for sexual assault cases applies to the present proceeding unless it "was settled by the parties and the settlement is legally binding," as provided by the new s. 16(1.2)(b) of the Limitations Act, 2002. Therefore, it is not necessary to address the appellant's submissions regarding the motion judge's discoverability analysis.

[18] When the parties argued the summary judgment motion in February, 2016, the Limitations Act, 2002 contained two limitation period regimes for sexual assault claims, the application of which turned upon the nature of the relationship between the plaintiff and the defendant. First, under s. 16(1)(h), no limitation period applied to a sexual assault claim against a person in a position of trust or authority over the complainant or on whom the complainant was dependent. Second, for all other sexual assault claims, the ordinary two-year limitation period applied. However, pursuant to s. 10(1), time did not run while the complainant was incapable of commencing a proceeding because of her physical, psychological or mental condition; s. 10(3) presumed the person was incapable of commencing the proceeding earlier than the date it was commenced, unless the contrary was proved.

[19] Upon coming into force on March 8, 2016, Schedule 2 to the Amending Act significantly changed the provisions of the Limitations Act, 2002 concerning sexual assault claims. Section 16(1)(h) of the Act was amended to provide there is no limitation period in respect of "a proceeding arising from a sexual assault." Section 10 of the Act dealing with a plaintiff's capacity was repealed.

[20] The new ss. 16(1.1) and (1.2) gave retroactive effect to the removal of any limitation period for "a proceeding arising from a sexual assault":

16. (1.1) Clauses (1)(h), (h.1) and (h.2) apply to a proceeding whenever the act on which the claim is based occurred and regardless of the expiry of any previously applicable limitation period, subject to subsection (1.2).

(1.2) Subsection (1.1) applies to a proceeding that was commenced before the day subsection 4(2) of Schedule 2 to the Sexual Violence and Harassment Action Plan Act (Supporting Survivors and Challenging Sexual Violence and Harassment), 2016 came into force, unless the proceeding,

(a) was dismissed by a court and no further appeal is available; or

(b) was settled by the parties and the settlement is legally binding.

[21] In his reasons, the motion judge engaged in a lengthy analysis about whether the two-year limitation period had expired before Ms. Cook commenced this action on May 31, 2013. The enactment of the Amending Act prior to the release of his reasons rendered that analysis unnecessary. Discoverability no longer is part of the limitation period regime governing sexual assault claims. The "no limitation period" regime applies to a proceeding "whenever the act on which the claim is based occurred and regardless of the expiry of any previously applicable limitation period," subject to the transitional rules contained in s. 16(1.2).

[22] By enacting ss. 16(1.1) and (1.2), the Legislature expressly addressed the application of the amendments to a proceeding, such as Ms. Cook's, which was commenced before March 8, 2016. The "no limitation period" regime applies to Ms. Cook's action unless (i) her proceeding was dismissed by a court and no further appeal is available or (ii) it was settled by the parties and the settlement is legally binding.

[23] By March 8, 2016, Ms. Cook's 2013 action for sexual assault had not been dismissed by a court with no further appeal available. Taking the decision under reserve made no difference. Even had the motion judge released a decision dismissing the action on the last day of the hearing, February 24, 2016, the time for an appeal to this court would not have expired before March 8, 2016. Consequently, Ms. Cook's sexual assault action would not be subject to any limitation period unless Mr. Joyce could demonstrate the proceeding was settled by the parties and the settlement is legally binding.

[24] Although clearly by March 8, 2016 the parties had not settled the proceeding Ms. Cook initiated with her May 31, 2013 notice of action, Mr. Joyce takes the position that the subject-matter of the 2013 proceeding was settled before March 8, 2016. I accept that if Mr. Joyce can establish the parties concluded such a settlement, he is entitled to the protection of s. 16(1.2)(b) of the Limitations Act, 2002. In the circumstances of this proceeding then, the enactment of the Amending Act effectively reduces Mr. Joyce's limitation period and settlement defences to a single issue – is there a genuine issue requiring a trial that the parties settled Ms. Cook's allegations of sexual assault before March 8, 2016?

PART II: THE SETTLEMENT ISSUE

[25] Mr. Joyce submits there is no genuine issue requiring a trial regarding a settlement. He argues the parties reached an oral settlement agreement in November 2011, and the motion judge erred in finding they had not. Consideration of this submission requires a review of the evidence concerning the settlement issue.

A. The evidence regarding a settlement

2011

[26] As mentioned, Ms. Cook alleges Mr. Joyce sexually assaulted her on May 19, 2011.

[27] Ms. Cook and Mr. Joyce met in about 2006. At the time, she was 25 years old; he was 75 years old. They developed a friendship; it occasionally involved sex. In early 2010 the sexual relationship ended, but they continued to see each other.

[28] Ms. Cook went to Mr. Joyce's house on May 18, 2011, with the understanding she would stay the night in a guest bedroom and then drive him to a medical appointment the following day.

[29] There is no dispute that on the morning of May 19, Mr. Joyce went into the guest bedroom to wake up Ms. Cook. What happened next is highly contested. Mr. Joyce states he went into the guest bedroom, touched Ms. Cook in an attempt to wake her, but she did not respond. He left the room, got dressed, and drove to the medical appointment. On Ms. Cook's version of events, Mr. Joyce touched her in a sexual manner, at which point she screamed, he left, and Ms. Cook ultimately called her mother to pick her up.

[30] Ms. Cook thereafter consulted the Dickinson Wright law firm, meeting with Mr. Miller on June 21, 2011. On July 21, Mr. Miller wrote Mr. Joyce enclosing a draft statement of claim in which Ms. Cook alleged Mr. Joyce had sexually assaulted her the previous May. In the draft claim, Ms. Cook sought general damages of $1 million and additional damages of $600,000. In his covering letter, Mr. Miller wrote that "it is our position at this time we would like to meet with you and your lawyer in an attempt to resolve this matter amicably."

[31] In his affidavit filed on the summary judgment motion, Douglas Burns, Mr. Joyce's lawyer, deposed he spoke to Mr. Miller in late July to advise Mr. Joyce was prepared to forgive a number of loans Mr. Joyce had advanced to Ms. Cook – totalling at least $100,000 – and pay a further sum of $25,000 in full and final satisfaction of all matters.

[32] Mr. Burns followed-up with a letter to Mr. Miller of August 17 asking for a response. Mr. Miller replied on August 19, stating Ms. Cook was "not prepared to accept your client's offer of settlement and is seeking damages as set out in the draft Statement of Claim."

[33] That elicited the following response from Mr. Burns: "Mr. Joyce has instructed me to prepare and issue a Claim for the $150,000 that Ms. Cook borrowed from him to support her lifestyle while she pursued an earlier Court action." Mr. Joyce issued a statement of claim on August 15, 2011 seeking repayment of monies he had loaned Ms. Cook (the "Loan Action"), which he alleged totalled $150,000. He did not serve the claim on her at that time.

[34] On August 23, Mr. Miller wrote to Mr. Burns advising he was "meeting with my client later this week and will respond to your aforementioned letter early next week."

[35] A month later, on September 23, Mr. Burns wrote to Mr. Miller advising Ms. Cook had been in contact with Mr. Joyce "on more than one occasion, to discuss this matter." Mr. Burns advised Mr. Joyce remained "prepared to forgive the money owing to him, and also make tantamount to a charitable contribution, because of his past friendship with your client."

[36] Mr. Burns wrote again on September 28 advising "your client had some discussions with Mr. Joyce. It seems to me that this matter should be resolved. I think we have made a very generous offer."

[37] Subsequent calls from Mr. Burns to Mr. Miller went unreturned. On October 14, Mr. Burns wrote again stating: "Ms. Cook continues to call Mr. Joyce, usually later in the evening, and it seems that she is requesting another loan. This issue arose when Mr. Joyce advised your client that he was not going to make a further loan to her, and that remains his position." As of that date, Mr. Joyce had not yet served his Loan Action statement of claim on Ms. Cook, with Mr. Burns again inquiring whether Mr. Miller had instructions to accept service of the claim.

[38] There is no dispute several telephone conversations took place directly between the parties in November, 2011. What they discussed is in dispute.

[39] Mr. Joyce deposed Ms. Cook wanted to resolve her allegations and the outstanding loan. He stated they reached an oral, with prejudice settlement by November 21 under which Ms. Cook agreed to stop pursuing and advancing her allegations about the events on the morning of May 19. In return, Mr. Joyce would forward to her $50,000 to help her with her legal expenses and other financial liabilities; he would forgive the loan.

[40] On his cross-examination, Mr. Joyce gave various evidence about the events surrounding the settlement: a final settlement was reached in a conversation with Ms. Cook on November 21, 2011; the settlement was the result of a mutual agreement between Ms. Cook and Mr. Joyce's lawyer; he could not recall whether the settlement was the product of a combination of calls and in-person meetings; he did not know whether he told his lawyer the terms of the settlement; and the settlement was negotiated between the lawyers.

[41] On her part, Ms. Cook deposed that Mr. Joyce offered to pay her $250,000 in September, but she declined his offer. In her November calls with Mr. Joyce, she requested $50,000 to cover some costs she had incurred because of him, and Mr. Joyce agreed. She did not view the payment as a settlement.

[42] Ms. Cook denied the parties had reached a settlement under which Mr. Joyce would forgive the outstanding loan. Ms. Cook took the position that Mr. Joyce had forgiven that loan before the May 19 incident had occurred. In support of that position, Ms. Cook relied on a surreptitious recording she made of a telephone conversation she had with Mr. Joyce about one hour after the May 19 incident, when Mr. Joyce was on his way to his medical appointment. According to the transcript of the recording, Mr. Joyce said to her: "I've loaned you a hundred thousand plus dollars and, uh, and I've forgiven that loan."

[43] On November 23, 2011 Mr. Burns wrote Mr. Miller:

I have been advised that our respective clients have met and settled their differences. Under the circumstances I would propose to close my file. As I have not had the courtesy of a response from you to my earlier telephone messages or my correspondence, I anticipate that you may have closed your file as well.

[44] Mr. Miller did not reply to that letter.

[45] There is no dispute that Mr. Joyce requisitioned from his company, Jetport Inc., a cheque in the amount of $50,000 payable to Mr. Miller at the Dickinson Wright law firm. Mr. Joyce produced his handwritten note to his assistant requisitioning the cheque on which he wrote: "Re Avie Cook Paid in Full". On the cheque stub appeared the notation: "Re: Avie Cook Account paid in full".

[46] Mr. Joyce sent the $50,000 cheque to Ms. Cook's lawyer; he did not transmit the funds through his own lawyer.

[47] On cross-examination, Ms. Cook refused to waive privilege over her communications with her various counsel. However, she did produce a December 9 email sent to her from Mr. Miller's office that read:

We have received a cheque from Jetport Inc in the amount of $50,000.00 "Re: Avie Cook PAID IN FULL" along with reference to Invoice dated November 25/11. Please provide your instructions.

[48] No such invoice was placed before the court below or this court.

2012

[49] Ms. Cook acknowledged that on January 6, 2012 her mother picked up a cheque from Dickinson Wright in the amount of $49,478.87, which Ms. Cook deposited into her bank account.

[50] On February 13, the Superior Court of Justice gave notice to Mr. Joyce that his Loan Action would be dismissed as abandoned unless it was set down for trial. Mr. Joyce did not set the Loan Action down for trial. On April 11, 2012 the Loan Action was dismissed as abandoned. It appears Mr. Joyce never sent or served his statement of claim on Ms. Cook or her counsel. There is no evidence Mr. Joyce or his counsel advised Ms. Cook or her counsel about the administrative dismissal of his Loan Action.

2013

[51] Mr. Joyce deposed he thought they had resolved the matter amicably. They resumed their friendship. He acknowledged going out for dinner with Ms. Cook in January, 2013. He also stated that in April, 2013, at her request, he directed his executive team to meet with Ms. Cook and others to consider an investment in an equity fund for which Ms. Cook was soliciting investors. Mr. Joyce did not make an investment.

[52] According to Ms. Cook, she went out for dinner or drinks with Mr. Joyce at least twice in early 2013. Statements made on those occasions ground her claim for slander.

[53] Ms. Cook commenced this action on May 31, 2013, some 16 months after she had received the $50,000 Mr. Joyce sent her lawyers. She filed her statement of claim at the end of June.

[54] Discussions then ensued between the parties. By then, Ms. Cook had retained new counsel – Clayton Ruby and Brian Shiller. On July 12, 2013 Mr. Burns wrote to Mr. Shiller that if "Ms. Cook is in fact simply looking for some kind of personal satisfaction that might be generated by a formal but confidential apology, the same might be available." The parties exchanged drafts of a possible form of apology, but reached no agreement.

[55] Both parties agree that in October, 2013 a meeting took place at the Ritz Carlton Hotel in Toronto between Mr. Joyce and his lawyer, Mr. Burns, on the one hand, and Ms. Cook's legal advisors, Messrs. Ruby and Shiller, on the other.

[56] Although she was not present in the room where her lawyers met with Messrs. Joyce and Burns, Ms. Cook deposed Mr. Shiller "came back and forth to ask me if I would accept multiple offers." No resolution was reached at that time.

[57] On his cross-examination, Mr. Joyce stated, in respect of his meeting with Mr. Ruby: "we again offered just for her to go away". Mr. Joyce denied offering Ms. Cook $1 million to settle her lawsuit; he said there was just a hypothetical raised by Mr. Burns whether $1 million would settle the lawsuit.

[58] Finally, Ms. Cook deposed that on October 23 she met with her lawyers who told her Mr. Joyce was offering $1 million to settle her claim. Ms. Cook produced an October 24, 2013 letter to her from Mr. Shiller which stated, in part:

We had you come to the office on short notice and we are grateful that you were able to attend so quickly. The reason for the meeting was that we were presented with an offer of settlement in your case for $1,000,000. As you will recall, our previous offer was for $7,500,000. At our meeting with him, Joyce had responded to that offer with indignation and a statement that he would pay $50,000 and no more.

[59] No resolution was reached. Mr. Joyce then served his statement of defence dated October 25, 2013.

B. The motion judge's reasons

[60] The motion judge rejected Mr. Joyce's submission that there was no genuine issue requiring a trial as to whether he had settled Ms. Cook's sexual assault claim on the basis of the payment of $50,000 and the abandonment of his Loan Action. Instead, the motion judge found, as a fact, there was no settlement. He concluded that in the fall of 2011 both parties were playing tricks on the other, with the result they did not reach a binding settlement. Specifically, the motion judge stated, at paras. 79-81 of his reasons:

I believe the truth to be that both Mr. Joyce and Ms. Cook were attempting to play tricks on one another by the manner in which they were orchestrating the payment of $50,000, including their assiduousness in keeping the lawyers "out of it," virtually from the time that Mr. Miller wrote his July 2011 demand letter until Ms. Cook deposited almost $50,000 in her CIBC bank account.

Mr. Joyce's trick was to create a hoax settlement because he knew that if he pressed for a real settlement - with minutes of settlement, mutual releases, a confidentiality agreement, the voiding of the promissory note, and the formal dismissal of his $150,000 action already commenced in Hamilton, then Ms. Cook would deny any settlement had been reached. Mr. Joyce believed, however, that he could trick Ms. Cook into appearing to have settled the claim, precisely because she would not wish to formalize any settlement at $50,000, which would not be rich enough for her and which settlement would sink Ms. Cook's plans to advance her own career prospects with future business dealings with Mr. Joyce or perhaps her unrealized ambitions of becoming Mr. Joyce's spouse or his well-paid personal assistant.

Ms. Cook's trick was to deceive Mr. Joyce into thinking he had settled the sexual assault claim, which would allow her to resume her business or personal courting of Mr. Joyce with the hedge of a fallback sexual assault claim. I believe that she knew that Mr. Joyce's failure to insist on releases and a confidentiality agreement was his Achilles heel that would allow her to argue that there was only a partial settlement or no settlement at all.

[61] After accepting Mr. Joyce's submission that the court should draw an adverse inference that there was a settlement from Ms. Cook's failure to disclose her communications with her lawyers, the motion judge continued, at paras. 85-87:

And there is no adverse inference that would change my conclusion that there was no settlement between Mr. Joyce and Ms. Cook. There is no getting around the legal fact that a contract requires a meeting of minds. Oral contracts are possible, but they are obviously more difficult to prove than contracts in writing where the terms of the contract are set out so that an objective observer might determine what the agreement was. In the immediate case, "COOK, Paid in Full" does not prove a settlement.

It is not necessary to discuss the trite law about contract formation. I find as a fact that there was no settlement. This finding creates an issue estoppel. I dismiss the branch of Mr. Joyce's summary judgment motion that relies on the argument that Ms. Cook's claim was discharged by a settlement.

If requested, I would grant a partial summary judgment to Ms. Cook dismissing Mr. Joyce's settlement defence. The court does not require a cross-motion for summary judgment when it can decide the issue that is the subject matter of the motion for summary judgment: King Lofts Toronto I Ltd. v. Emmons, 2014 ONCA 215, affirming 2013 ONSC 6113.

C. Positions of the parties

[62] Mr. Joyce submits the motion judge made two main errors in finding the parties had not settled Ms. Cook's sexual assault claim. First, the motion judge erred in law by treating the search for a meeting of the minds of the parties as a purely subjective inquiry, rather than determining objectively from the parties' overt acts whether they had entered into a binding contract.

[63] Second, the motion judge made several palpable and overriding errors of fact. The most significant error, Mr. Joyce submits, is the motion judge's finding that both parties were attempting to play tricks on one another by the manner in which they were orchestrating the payment of $50,000. Mr. Joyce submits there was no evidence to support such findings.

[64] Ms. Cook submits the motion judge did not err in finding the parties had not settled her sexual assault claim.

D. Analysis

[65] A settlement agreement is subject to the general law of contract. For a settlement agreement to exist, the court must find the parties (i) had a mutual intention to create a legally binding contract and (ii) reached agreement on all of the essential terms of the settlement: Olivieri v. Sherman (2007), 2007 ONCA 491, 86 O.R. (3d) 778 (C.A.), at para. 41. Whether the parties have manifested mutual assent to specific terms usually is determined from their overt acts: Bogue v. Bogue (1999), 46 O.R. (3d) 1 (C.A.), at para. 17. Or, as described by this court in McLean v. McLean, 2013 ONCA 788, 118 O.R. (3d) 216, at para. 10, a court must employ an objective approach to the evidence, determining "what a reasonable observer would have believed the parties intended, taking into consideration the evidence of all the parties as well as the surrounding documentary evidence."

[66] Where the parties reduce their bargain to writing, a court determines the parties' intentions in accordance with the language used in the written document, having regard to the objective evidence of the factual matrix: Salah v. Timothy's Coffees of the World Inc., 2010 ONCA 673, 268 O.A.C. 276, at para. 16.

[67] Oral contracts, such as the one at issue in the present case, present different challenges regarding the issues of formation and interpretation. As put by Angela Swan and Jakub Adamski in Canadian Contract Law, 3rd ed. (Markham, ON: LexisNexis, 2012), at §2.27:

There is no general rule against the enforcement of oral promises, but the fact that a promise is oral suggests that its making may not have been accompanied by anything that sufficiently brought home to the parties the significance of what they were doing and, of course, the terms of an oral promise are no more certain than the parties' recollections of them.

[68] Mr. Joyce submits the motion judge erred in law by treating the search for a meeting of the minds of the parties as a purely subjective inquiry. I think that mischaracterizes the motion judge's analysis, when viewed in its entirety. Although the motion judge did not find it "necessary to discuss the trite law about contract formation," he did recognize the challenges posed by allegations the parties had formed an oral contract: "Oral contracts are possible, but they are obviously more difficult to prove than contracts in writing where the terms of the contract are set out so that an objective observer might determine what the agreement was": para. 85.

[69] The motion judge's reasons demonstrate he was alive to the need consider evidence about the overt acts of the parties in ascertaining whether they had formed an oral contract. Indeed, the motion judge considered the evidence of several overt acts: the notation on the $50,000 cheque stub of "Avie Cook, PAID IN FULL"; the transmittal of the cheque to Ms. Cook's lawyer; the cashing of the cheque and its deposit into Ms. Cook's personal bank account; and the significance of the lack of minutes of settlement and release.

[70] However, the motion judge held the evidence did not establish the formation of an oral settlement contract. Key to that conclusion was his finding about the parties' subjective intentions – that is, both Mr. Joyce and Ms. Cook "were attempting to play tricks on one another by the manner in which they were orchestrating the payment of $50,000."

[71] There are two problems with that finding of fact. First, as Mr. Joyce submits, there was no evidence to support it. In finding both parties were trying to trick each other, the motion judge drew inferences beyond those available on the written record before him and engaged in unsupported speculation. Those findings were central to the motion judge's conclusion that there was no meeting of the minds between the parties, and therefore no settlement. Consequently, the findings of fact that drove the motion judge's conclusion that the parties did not reach a settlement were the product of palpable and overriding error.

[72] Second, although the motion judge recognized the need to apply an objective analysis to the issue of whether the parties had reached a settlement agreement, he ended up focusing and relying on the parties' subjective intention, thereby misapplying the law to the facts. The motion judge failed to heed the caution given by Swan and Adamski, at §4.19:

Intention is always a slippery concept; we all know in general what the concept entails but translating that concept into a workable rule or into a sure guide for courts or lawyers is not easy. The situations where difficulties arise are, of course, those where the offeror's intentions are either not clear or are at variance with what the offeree understood. In these situations, the law has had to take an objective view: the question will be, not what the offeror as a matter of fact subjectively intended, but what a reasonable person in the position of the offeree would have understood the offeror to have intended by doing what was done or by saying what was said. [Emphasis added].

[73] By focusing on whether the parties intended to trick each other, the motion judge lost sight of the need to assess their conduct through the lens of a reasonable person, taking into account all relevant evidence.

[74] By way of summary, in concluding the parties did not reach a settlement, the motion judge misapplied the law to the facts and made palpable and overriding errors of fact. As a result, his decision that the parties did not reach a settlement cannot stand and must be set aside.

PART III: SHOULD THIS COURT DECIDE THE SETTLEMENT ISSUE?

[75] Mr. Joyce asks this court to remedy the motion judge's errors by dismissing Ms. Cook's action. He calls on us to substitute our view of the evidence for that of the motion judge and find the parties reached a settlement of Ms. Cook's sexual assault claim in November, 2011. Alternatively, Mr. Joyce submits this court should direct the action proceed to trial.

[76] For the reasons that follow, I would not make the findings of fact sought by Mr. Joyce. Instead, I would direct Ms. Cook's sexual assault claim proceed to trial.

A. General principles about the scope of appellate remedial powers on summary judgment appeals

[77] On its face, s. 134 of the Courts of Justice Act gives this court broad powers to remedy errors. This court can make any order or decision that ought to or could have been made by the court appealed from: s. 134(1)(a). As well, "in a proper case", s. 134(4)(a) allows this court to "draw inferences of fact from the evidence, except that no inference shall be drawn that is inconsistent with a finding that has not been set aside." Section 134(4)(b) authorizes this court to receive further evidence, by affidavit, transcript, or even "oral examination before the court," again "in a proper case."

[78] In Hryniak v. Mauldin, 2014 SCC 7, [2014] 1 S.C.R. 87, at para. 2, the Supreme Court of Canada stated "a culture shift is required in order to create an environment promoting timely and affordable access to the civil justice system." While Hryniak focussed on the culture shift needed at the trial level, the court's comments apply equally to civil appellate courts. An appeal court's exercise of its civil remedial powers set out in CJA s. 134 also should promote "timely and affordable access to the civil justice system."

[79] But, appeal courts are not trial courts – our relationship to the evidentiary record differs markedly from that of courts of first instance. We rarely see those who give the evidence. An appeal court sees only words on a page, not the live human beings who voice those words. As a result, while this court has broad fact-finding powers, the state of the appellate evidentiary record and the nature of the issue in dispute influence the degree to which this court can and should exercise those powers.

[80] In civil appeals where credibility is not involved or where the evidence is predominantly documentary, as a general principle an appellate court may make whatever findings are necessary in the interests of expediency and finality: Donald Brown, Civil Appeals, loose-leaf (November 2016) (Toronto: Carswell, 2013), vol. 2, 6:2230. By contrast, the existence of credibility issues or the thinness of the documentary record usually prompts a more cautious approach to fact-finding by civil appellate courts. Brown writes, at 6:2321, that:

[W]here an error is such that evidence must be "weighed" and new findings made, a new trial may be preferred … [O]nly where a court can make the findings with confidence will it do so ... [W]here the findings depend on assessing credibility...or where a weighing of conflicting evidence is required, appellate courts will almost always direct that the matter be retried.

[81] This observation echoes two comments the Supreme Court of Canada made in Hryniak about the appropriateness of granting summary judgment in a particular case. First, there will be no genuine issue requiring a trial when the judge is able to reach a fair and just determination on the merits on the motion. This will be the case, in part, when the process allows the judge to make the necessary findings of fact: para. 49. Second, the evidence on a summary judgment motion need not be equivalent to that at trial, but it "must be such that the judge is confident that she can fairly resolve the dispute": para. 57. These comments apply equally, in my view, to the exercise of fact-finding powers by either the summary judgment motion judge or by the reviewing appellate court.

[82] Finally, it is worth recalling what the Supreme Court of Canada said in Sterling Trusts Corp. v. Postma et al., [1965] S.C.R. 324. At p. 328, the court stated that where the appeal record contains evidence on a key issue that could point one way or the other, an appellate court risks engaging in "mere guess-work to make either finding from the written record; the only tribunal by which such a finding can safely be made is one that has seen and heard the witnesses."

[83] An appellate court must keep all these considerations in mind when deciding whether to exercise its remedial fact-finding powers on an appeal from a summary judgment order.

B. Application to the present case

[84] The record on whether the parties entered into an oral settlement contract in November, 2011 contains conflicting and disputed material facts.

[85] First, in their affidavits and during their out-of-court cross-examinations, both parties gave conflicting evidence about the contents of their discussions in November, 2011, as described earlier in these reasons.

[86] Second, Mr. Joyce states one term of the settlement agreement required him to forgive loans he had made to Ms. Cook. She contends Mr. Joyce admitted to forgiving those loans before the incident had taken place.

[87] Third, the documentary record concerning a settlement is thin. The parties did not memorialize any oral contract in minutes of settlement or a release. Nor did their lawyers jointly confirm a settlement. Mr. Burns' letter of November 23, 2011 to Mr. Miller advised the parties had "settled their differences," but did not particularize the terms of any settlement. Mr. Miller did not respond to that letter.

[88] Fourth, there is no doubt Mr. Joyce transmitted $50,000 to Ms. Cook and, pursuant to his direction, the cheque stub bore the notation "Re Avie Cook paid in full." But the parties gave conflicting evidence about the purpose of that payment.

[89] Next, although the court administratively dismissed the Loan Action, Mr. Joyce did not serve the statement of claim on Ms. Cook, nor did he communicate the fact of the dismissal in writing to Ms. Cook or her counsel. On her part, Ms. Cook points to statements Mr. Joyce made in a taped telephone conversation shortly after the alleged assault as evidence he had already forgiven the amounts he later sued on.

[90] Finally, conflict also exists in the evidence about the parties' conduct following the $50,000 payment. Mr. Joyce points to the parties' resumption of their friendship as evidence they had settled the dispute over the May 19 incident and were moving on with their lives. On her part, Ms. Joyce contends the exchange of draft apologies in the summer of 2013 and subsequent discussions that October between the parties and their lawyers demonstrate no final settlement of her claim was reached in 2011. She deposed those discussions included a settlement offer of $1 million by Mr. Joyce. He disputes some of the facts Ms. Cook alleges about those October discussions, and denies he offered $1 million to settle her sexual assault claim.

[91] Summary judgment can operate as a timely, fair, and cost-effective means of adjudicating a civil dispute, but it has its limits. Not all civil disputes are amenable to a final adjudication on the merits by summary judgment. The present summary judgment motion proceeded on an entirely written record, with the motion judge declining to hear oral evidence under r. 20.04(2.2). As this court has observed, in certain cases adjudication exclusively on an written record poses a risk of substantive unfairness: Baywood Homes Partnership v. Haditaghi, 2014 ONCA 450, 120 O.R. (3d) 438, at para 44.

[92] The more important credibility disputes are to determining key issues, the harder it will be to fairly adjudicate those issues solely on a paper record. As Benotto J.A. wrote in Trotter Estate, 2014 ONCA 841, 122 O.R. (3d) 625, at para. 55, "[i]t is not always a simple task to assess credibility on a written record. If it cannot be done, that should be a sign that oral evidence or a trial is required."

[93] In the present case, I cannot see how the issue of whether the parties concluded an oral settlement contract can be fairly adjudicated without a trier of fact hearing viva voce evidence from Mr. Joyce and Ms. Cook. I say that for two reasons.

[94] First, the parties' conflicting recollections of their discussions in November, 2011, coupled with the thin and equivocal documentary record, do not provide an adequate evidentiary foundation to assess the credibility of the parties in the absence of viva voce evidence on those events.

[95] Second, the two central issues in the sexual assault component of this action require the trier of fact to make credibility assessments of both parties: (i) did a sexual assault take place, and (ii) did the parties settle Ms. Cook's claim? Just as the parties' evidence about whether they concluded a settlement stands diametrically opposed, so too does their evidence about what happened in the guest bedroom on May 19, 2011. The trier of fact may prefer the evidence of one party on the settlement issue, and the other party on the sexual assault issue. Or, the trier of fact may prefer the evidence of one party on both. However, both issues equally engage the credibility of the parties. A fair determination of the action on the merits requires their assessment together.

[96] I recognize that litigants often resort to motions for partial summary judgment to decide limitation defences. However, partial summary judgment motions operate in tension with the general policy of the rules that separate hearings on one or more issues should only occur with the consent of the parties: r. 6.1.01. While a useful tool in some cases, partial summary judgment motions create their own challenges for the fair adjudication of disputes. For example, this court has cautioned that partial summary judgment may not be appropriate where it risks duplicative or inconsistent findings: Canadian Imperial Bank of Commerce v. Deloitte & Touche, 2016 ONCA 922, [2016] O.J. No. 6319, at paras. 37 and 38.

[97] In the present case, granting partial summary judgment on the settlement issue would risk an unfair result by placing in watertight compartments the assessment of the parties' credibility on the two key issues – whether an assault occurred and whether they settled their dispute. Since the trier of fact's view of the credibility of the parties on one issue may well influence his or her view on the other, the parties' credibility on the two issues should be assessed together, not separately.

[98] Before this court counsel for Mr. Joyce urged that the issue of settlement could be disposed of by drawing an adverse inference against Ms. Cook who, he submits, selectively disclosed portions of confidential communications with her lawyers when doing so supported her position in this lawsuit, while refusing to waive privilege over the balance. Therefore, Mr. Joyce submits, this court should infer that those portions of her lawyers' files over which Ms. Cook refused to waive privilege would have afforded evidence that her claim was settled.

[99] In a proper case a trier of fact may draw an adverse inference from a witness's refusal to waive privilege – particularly where that witness has otherwise selectively or tactically disclosed privileged communications in a manner tantamount to an implied waiver of privilege: see, for example 2405416 Ontario Ltd. v. 2405490 Ontario Inc., 2016 ONSC 3893, [2016] O.J. No. 3330, at paras. 35-37, aff'd 2016 ONCA 696, [2016] O.J. No. 4922 (without comment on this point); Morassut v. Jaczynski Estate, 2015 ONSC 502, 330 O.A.C. 126 (Div. Ct.), at paras. 29-30. Given the state of the record before this court, I would leave it to the court below – whether on a motion before trial or at trial - to deal with Ms. Cook's selective waiver of privilege.

[100] For those reasons, I conclude this is not a proper case for this court to exercise its appellate fact-finding powers on the issue of whether the parties reached an oral settlement agreement of Ms. Cook's claim in November, 2011. Accordingly, I would set aside the motion judge's dismissal of Mr. Joyce's summary judgment motion in respect of Ms. Cook's sexual assault claim and his grant of Ms. Cook's cross-claim dismissing Mr. Joyce's settlement and limitation period defences. I would direct that all issues concerning Ms. Cook's sexual assault claim proceed to trial.

PART IV: THE RESPONDENT'S SLANDER CLAIMS

[101] In her action, Ms. Cook seeks damages for two alleged slanders. She contends the first took place on January 11, 2013 at a dinner where she was seated with Mr. Joyce and Mr. Brian A. Robbins. She pleads "Mr. Robbins stated that he was surprised [Mr. Joyce] had invited [Ms. Cook] out for dinner when she had falsely accused him of the attack." Ms. Cook further pleads that Mr. Robbins could only have come by such information had Mr. Joyce conveyed it to him.

[102] Ms. Cook pleads the second slander took place in March 2013 when she was having drinks with Mr. Joyce and a man named Howard, a restaurant owner. Ms. Cook pleads "she overheard [Mr. Joyce] state to Howard that he should be wary of [Ms. Cook] because she is 'crazy' and had falsely accused him of the attack."

[103] In her affidavits, Ms. Cook adduced evidence in support of her pleaded facts.

[104] In his statement of defence, Mr. Joyce acknowledges that "he has called [Ms. Cook] a liar because the fact is that she is lying about the occurrence of the sexual assault or 'attack'." He pleads the statements Ms. Cook alleges he made to Mr. Robbins and "Howard" "were true in substance and therefore do not constitute slander." He further pleads Ms. Cook has not suffered any damages for which he is responsible.

[105] The motion judge cursorily dismissed Ms. Cook's claim for slander in para. 93 of his reasons:

I do not believe Ms. Cook about these two incidents. Assuming, however, that the comments were made as alleged, I find as a fact that there is no evidence that they caused any harm or any special damages to Ms. Cook.

[106] In Trotter Estate, Benotto J.A. wrote, at para. 55, that "[w]here important issues turn on credibility, failure to make credibility findings amounts to reversible error." Here, the motion judge gave no reasons why he did not believe Ms. Cook about these two incidents. The motion judge committed a reversible error by rejecting her evidence without explaining why he did so. Also, it is difficult to reconcile the motion judge's conclusion with Mr. Joyce's plea in his statement of defence that the statements Ms. Cook alleges he made on the two occasions were true in substance.

[107] In light of the procedural history of Mr. Joyce's summary judgment motion, I do not regard the absence of evidence from Ms. Cook about special damages caused by the alleged slanders as a sufficient basis to grant summary judgment dismissing that part of her claim, as the motion judge did. Mr. Joyce's June 18, 2015 notice of motion focused exclusively on Ms. Cook's sexual assault claim. The record for the motion was completed by December, 2015. According to Ms. Cook, Mr. Joyce first raised the issue of summary judgment in respect of her slander claim in his January 2016 factum. Although Ms. Cook is a very sophisticated self-represented litigant, I think it was unfair for the motion judge to dismiss her slander claim given the state of Mr. Joyce's pleading and the focus of his motion on the sexual assault claim. I therefore would set aside the motion judge's dismissal of Ms. Cook's slander claims.

DISPOSITION

[108] For the reasons set out above, I would allow Mr. Joyce's appeal and set aside the entirety of the motion judge's Order dealing with Ms. Cook's sexual assault claim. I would allow Ms. Cook's cross-appeal and set aside the dismissal of her slander claims. Finally, I would direct that Ms. Cook's action proceed to trial on all issues.

[109] Given the mixed success of the parties on this appeal, I would direct the costs of this appeal to be in the cause of the action, with the amount, if any, to be assessed by the trial judge.

Released: January 20, 2017

"David Brown J.A."

"I agree. R.G. Juriansz J.A."

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