Court File and Parties

Court of Appeal for Ontario Date: 20200311 Docket: C67273

Tulloch, Benotto and Jamal JJ.A.

Between: Marvin Rubner Applicant (Appellant)

And: Joseph Rubner Respondent (Respondent)

Counsel: Markus Kremer and Graham Splawski, for the appellant Sean M. Grayson, for the respondent

Heard: March 5, 2020

On appeal from the judgment of Justice Laurence A. Pattillo of the Superior Court of Justice, dated July 11, 2019, with reasons reported at 2019 ONSC 4110.

Reasons for Decision

[1] The sole issue on this appeal is whether two brothers, Marvin and Joseph Rubner, reached a binding settlement agreement of the litigation between them relating to their respective interests in a real estate business. Marvin says that he and his brother had a deal; Joseph disputes this.

[2] The application judge sided with Joseph’s position, based on his interpretation of documents and emails relating to the alleged agreement and evidence of the surrounding circumstances preceding it.

[3] The application judge found that a handwritten document of “Deal Points” signed by Joseph, which was provided to Marvin and his counsel on July 31, 2018, limited the authority of Joseph’s counsel to renegotiate the Deal Points; it merely authorized Joseph’s counsel to negotiate comprehensive minutes of settlement implementing them. The application judge found that this limitation of authority arose from Joseph’s handwritten notation on the Deal Points: “I confirm my agreement to the deal points herein, and give authority to [my counsel] to negotiate comprehensive Minutes of Settlement.”

[4] Marvin never signed back the Deal Points, and instead responded with what his counsel described at the time as additional “material terms”. Joseph’s counsel then purported to accept the new terms without Joseph’s authorization.

[5] The application judge also supported his conclusion that Marvin and Joseph had not concluded a settlement agreement with: (1) evidence of a course of dealings showing that “both Marvin and Joseph understood that they each had to agree to the Deal Points or material terms of the settlement and they each had to sign the document setting out the Deal Points”; and (2) evidence showing that “Marvin’s counsel was aware of Joseph’s counsel’s limitation of authority.”

[6] The application judge therefore held that “no agreement was reached between Marvin and Joseph on the ‘Deal Points’ or material terms of the settlement. There was no mutual intention to agree and accordingly no binding settlement was reached between them”.

[7] Marvin now asserts that the application judge erred in his appreciation of the evidence by: (1) misunderstanding the nature and effect of the communications between Marvin’s counsel and Joseph’s counsel; (2) failing to consider the evidence of Joseph’s counsel that when he informed Marvin’s counsel that the parties were “ad idem”, he was communicating on Joseph’s behalf; and (3) finding that Joseph limited the authority of his counsel to renegotiate the Deal Points. In particular, Marvin asserts that the application judge applied the wrong legal test and should have asked whether Joseph’s counsel had ostensible rather than actual authority to conclude the settlement on Joseph’s behalf.

[8] We do not accept these arguments. The application judge’s interpretation of the Deal Points in light of the surrounding circumstances to determine whether the parties reached a binding settlement agreement is a question of mixed fact and law reviewable only for palpable and overriding error: Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, [2014] 2 S.C.R. 633, at paras. 50, 52. Marvin has shown no such error. The application judge’s decision is therefore entitled to appellate deference.

[9] We are not persuaded that the application judge failed to apply the correct legal test for ostensible authority. He cited, at paragraph 29 of his reasons, this court’s decision in Dick v. McKinnon, 2014 ONCA 784, at para. 4, as authority for the settled proposition that a solicitor of record has the ostensible authority to bind his or her client and that opposing counsel is entitled to rely on that authority, absent some indication to the contrary. He went on, at paragraphs 30 to 33 of his reasons, to apply that principle to the evidence in this case. He found an “indication to the contrary” regarding the ostensible authority of Joseph’s counsel in Joseph’s handwritten notation on the Deal Points, cited above at paragraph 3, that limited his counsel’s authority to negotiating the minutes of settlement, rather than the Deal Points, and in the evidence referred to at paragraph 5 above. The application judge’s application of the settled test for ostensible authority to his findings of fact is entitled to appellate deference.

[10] The appeal is dismissed. Costs are payable to Joseph in the agreed amount of $10,000, inclusive of HST and disbursements.

“M. Tulloch J.A.” “M.L. Benotto J.A.” “M. Jamal J.A.”