Court of Appeal for Ontario

Date: 2019-06-05

Docket: M50447 (C65874)

Motion Judge: van Rensburg J.A.

Between

Kevin Donovan Applicant (Appellant/Responding Party)

and

The Estate of Bernard Sherman and the Trustees of the Estate, and the Estate of Honey Sherman and the Trustees of the Estate Respondents (Respondents in Appeal/Moving Parties)

Counsel

Chantelle Cseh and Timothy Youdan, for the moving parties

Kevin Donovan, appearing in person

Heard: May 29, 2019

Reasons for Decision

[1] This is a motion for a stay of an order of this court pending the filing and disposition of the moving parties' intended application for leave to appeal to the Supreme Court of Canada, and, if leave is granted, pending the final disposition of the appeal.

[2] On December 15, 2017, prominent Toronto businessman and philanthropist Bernard Sherman and his wife, philanthropist Honey Sherman, were found murdered in their home. No one has yet been arrested and the crimes remain under police investigation.

[3] In June 2018, counsel for the estate trustees of the estates of Bernard Sherman and Honey Sherman filed in the Superior Court applications for a certificate of appointment of estate trustee in respect of each estate. On the application of the estate trustees, Dunphy J. granted initial ex parte protective orders sealing the applications for a certificate of appointment of estate trustee, the confidentiality application materials, and other documents relating to the administration of the Shermans' estates (the "Sealed Materials").

[4] Following a contested application to open the court files by the respondent, Kevin Donovan (who is Chief Investigative Reporter at the Toronto Star), Dunphy J. ordered on August 2, 2018 that the entire court file be sealed and remain sealed for a period of two years, subject to further order of the court.

[5] That order was set aside on appeal to this court on May 8, 2019. This court ordered that its decision would take effect ten days after being released. Trotter J.A. made an order on consent temporarily suspending the effects of the May 8th order and providing for the continued sealing of the Sealed Materials pending the determination of this motion.

[6] The motion is brought under s. 65.1 of the Supreme Court Act, R.S.C. 1985, c. S-26. Section 65.1(2) provides that such a motion may be brought before the serving and filing of the notice of application for leave to appeal, if the judge hearing the motion is satisfied that the party seeking the stay intends to apply for leave to appeal and that delay would result in a miscarriage of justice.

[7] The moving parties have 60 days from May 8th to apply to the Supreme Court for leave to appeal. It was essential that they move quickly for a stay, before they had served and filed their notice of application for leave to appeal, as this court's order allowing the appeal provided for the Sealed Documents to be unsealed within ten days. There is no question that the moving parties intend to apply for leave to appeal, and they have clearly articulated the grounds they propose to argue in their application to the Supreme Court. I am satisfied that they have met the test under s. 65.1(2).

[8] The test on a motion for a stay of an order of this court pending an application for leave to appeal to the Supreme Court of Canada, was set out by Strathy C.J.O. in Livent Inc. v. Deloitte & Touche, 2016 ONCA 395, 131 O.R. (3d) 784 (in Chambers), at paras. 4-5. The factors to be considered are: (1) whether there is a serious question to be determined; (2) whether the moving party will suffer irreparable harm if the stay is not granted; and (3) whether the balance of convenience favours a stay. The factors are not to be treated as watertight compartments and the strength of one factor may compensate for weaknesses of another. The overarching consideration is whether the interests of justice call for a stay. See also BTR Global Opportunity Trading Limited v. RBC Dexia Investor Services Trust, 2011 ONCA 620, 283 O.A.C. 321 (in Chambers), at para. 16.

(1) Serious Question to be Determined

[9] With respect to the first factor, whether there is a serious issue to be determined requires a preliminary assessment of the merits of the proposed appeal, as well as the merits of the proposed leave application. The assessment at this stage is described as a "low threshold": Livent Inc., at paras. 7-8.

[10] In considering whether the appeal would raise a serious issue, I note that this court and the application judge differed in their conclusions as to whether the first part of the Sierra Club test (Sierra Club of Canada v. Canada (Minister of Finance), 2002 SCC 41, [2002] 2 S.C.R. 522) was met. The application judge concluded on the evidence filed that the first part of the test was met – that the sealing order was necessary to prevent a serious risk to the privacy and safety of the trustees and beneficiaries of the two estates. He then applied the second part of the test to conclude that the salutary effects of the order sought outweighed its deleterious effects, including the effects on the right to free expression and the public interest in open and accessible court proceedings.

[11] On appeal, this court concluded that the privacy interests were not properly considered at the first stage of the Sierra Club test and that it was not an inference from the evidence, but speculation, that the disclosure of the contents of the estate files posed a real risk of serious physical harm to the beneficiaries and trustees.

[12] In Baier v. Alberta, 2006 SCC 38, [2006] 2 S.C.R. 311 (in Chambers), Rothstein J. noted that the extensive reasons of two levels of court, which came to different conclusions, made it apparent that there was a serious issue: at para. 16(a). Similarly in this case, a review of the reasons of the application judge and this court makes it clear that the central issue in dispute between the parties – whether public access to certain estate files should be denied, in whole or in part, for some period of time – raises a serious question.

[13] The real issue on this part of the test is whether there is any arguable merit to the proposed application for leave to appeal. Leave to appeal is granted sparingly in civil matters, and must meet the test under s. 40(1) of the Supreme Court Act. The question is whether or not it is likely that the Supreme Court would grant leave. Typically, leave is granted under s. 40(1) of the Supreme Court Act only where the proposed appeal raises an issue of public or national importance.

[14] The issues the moving parties intend to raise in their application for leave to appeal to the Supreme Court are identified and explained at some length in their factum on the stay motion, at paras. 36 to 51. Essentially, the proposed appeal would raise questions about (1) the appropriate analytical framework for an order restricting public access to court files involving non-litigious or "administrative" matters – something the Supreme Court has not yet determined; (2) whether, in the digital age, and having regard to the evolving jurisprudence concerning personal privacy, a person's privacy interests can amount to an important public interest at the first stage of the Sierra Club test; and (3) whether this court departed from relevant Supreme Court jurisprudence in concluding that the risk of harm was speculative and in failing to consider "objectively discernable harm".

[15] Mr. Donovan argues that there is no serious issue in this case because the law is settled. The proposed appeal involves a dispute about the application of the test for sealing orders, which has been consistently stated by the Supreme Court over the past 30 years. Mr. Donovan asserts that this court simply concluded, in its decision on the appeal, that the evidence was not sufficient to show a real, as opposed to a speculative, risk of serious harm to a public interest. He contends that the failure of the moving parties to move to file fresh evidence before this court undercuts their argument that there is a risk to personal safety if the court file is not sealed, and that the real concern here is personal privacy, which this court determined was not an important public interest to protect at the first stage of the Sierra Club test.

[16] I am satisfied that the low threshold of the first part of the test for a stay is met. The moving parties' proposed application for leave to appeal to the Supreme Court has some arguable merit. Although the application arises in the context of a civil matter, the foundation of the dispute engages important public interests, and the issues the moving parties seek to raise on a further appeal go beyond the simple application of a known test to given facts and would transcend the facts of this particular case. The first part of the test therefore favours the order sought by the moving parties.

(2) Irreparable Harm

[17] Here the moving parties say that if the order requested is refused, they will be irreparably harmed because the intended application for leave to appeal, and, if leave is granted, the appeal itself, will be rendered moot.

[18] Mr. Donovan argues that there will be no irreparable harm because this court has already determined that any harm that could result from the lifting of the sealing order is purely speculative. Mr. Donovan's focus is on the harm to an important public interest required under the first part of the Sierra Club test.

[19] Irreparable harm for the purpose of a stay motion is generally "harm which either cannot be quantified in monetary terms or which cannot be cured": Livent Inc., at para. 10, citing RJR-MacDonald Inc. v. Canada (Attorney General), [1994] 1 S.C.R. 311, at p. 341. The focus here is on the harm that would result to the moving parties if the order in question were not stayed pending their application for leave to appeal.

[20] I am satisfied that the moving parties would suffer irreparable harm if they were denied a stay, because their proposed application for leave to appeal, which I have concluded has arguable merit, would become moot. In Provincial Court Judges' Association of British Columbia v. British Columbia (Attorney General), 2018 BCCA 477, 430 D.L.R. (4th) 670 (in Chambers), the contested production of a Cabinet document was at issue. Bennett J.A. granted a stay of the B.C. Court of Appeal's order for production of the document, pending an application for leave to appeal to the Supreme Court. She accepted that, if the stay were refused, the proposed appeal would be rendered moot, which would irreparably harm the moving party "by disseminating potentially constitutionally-protected confidential information that might, at the end of the process, continue to be protected. In other words, the horse will be out of the barn": at para. 43.

[21] The same reasoning applies to this case. Refusal of a stay of this court's order would mean that the Sealed Materials would form part of the public record, resulting in the release of information that, if the appeal process were to run its course, might be protected.

(3) Balance of Convenience

[22] There is no affidavit evidence from the respondent addressing the harm that will arise if the stay is granted. Mr. Donovan relies on the delay that has already transpired since he first sought access to the estate files in July 2018, and that will continue while the moving parties seek leave to appeal to the Supreme Court. The delay is in having access to information about the administration of the Sherman estates. The moving parties assert that there is no particular urgency for public access to the contents of the court file.

[23] I am satisfied that the delay that Mr. Donovan and other members of the public would experience in obtaining access to the Sealed Documents before the application for leave to appeal is determined is outweighed by the irreparable harm that would follow if a stay were refused. The order sought has the effect of preserving the status quo during the relatively short period of time required for the determination of the moving parties' application for leave to appeal to the Supreme Court. If leave is refused, then the order of this court reversing the sealing order will take effect at that time – likely within a matter of a few months. If leave is granted, it will be up to the Supreme Court to determine whether the Sealed Materials will continue to be sealed pending disposition of the appeal.

[24] Finally, Mr. Donovan argues that, rather than staying the entire order of this court, I should redact the information that is truly confidential, and permit the balance of the court file to be opened to the public.

[25] I am not prepared to do so. Dunphy J., in granting the confidentiality order, and after reviewing the two estate files with an eye to determining whether there were parts that could be disclosed without revealing the names, addresses or bequests left to beneficiaries of either estate or the names and addresses of the trustees, concluded that there was "simply no meaningful part of either file that could be disclosed after making the number of redactions necessary to satisfy those conditions." In the appeal to this court, it was unnecessary to consider any possible redactions. What Mr. Donovan is asking, in effect, is that I put myself in the role of the judge of first instance, to review the Sealed Documents and to come to a different conclusion than he did. That is not something I am prepared to do. It is not appropriate, on this motion for a stay, to essentially make a fresh determination of the original merits of the application.

[26] It is in the interests of justice to grant the motion for a stay. The order of this court dated May 8, 2019 therefore is stayed pending the filing and determination of the moving parties' application for leave to appeal to the Supreme Court of Canada and the sealed materials shall accordingly remain sealed during this period. In accordance with their undertaking to the court, the moving parties shall serve and file their application for leave to appeal to the Supreme Court of Canada on or before June 21, 2019, and shall request that the motion, and, should leave be granted, any appeal to that court, be expedited.

[27] No costs are sought or awarded.

K. van Rensburg J.A.

Footnote

[1] I am told by counsel for the moving parties that the Sealed Materials include everything that has been and continues to be filed in the Superior Court concerning the administration of the two estates. They also confirm Mr. Donovan's expectation that the entire court file, including all documents filed after Dunphy J.'s order was made, will become public when any stay of this court's order expires.