Introduction

[1] The plaintiff, David Cheyne Heath, claims damages and other relief from the defendant, the Toronto International Film Festival Group Inc. (“TIFF”), for breach of fiduciary duty, breach of contract, intentional infliction of mental distress, and negligence.

[2] Mr. Heath’s claims relate to a television festival that was scheduled to be held in November 2015 before the film festival that year.

[3] Mr. Heath is a founder and director of a company, Canadian International Television Festival Inc. (“CITF”), with which TIFF contracted to present the television festival in November 2015.

[4] On November 13, 2015, TIFF notified Mr. Heath that it had elected to treat the contract with CITF as void because CITF had failed to pay the licence fee that was due and payable under the contract, even after extensions for payment had been given.

[5] Mr. Heath commenced this action on November 23, 2017. TIFF brings this motion for summary judgment dismissing the action on the ground that there are no genuine issues requiring a trial with respect to Mr. Heath’s claims.

[6] For the following reasons, TIFF’s motion is granted, and the action is dismissed.

Procedural Background

[7] This action was commenced by a notice of action issued on November 23, 2017. The statement of claim was filed on December 22, 2017. TIFF’s statement of defence was filed on November 26, 2018.

[8] On March 1, 2019, the presiding judge at Civil Practice Court scheduled TIFF’s motion for summary judgment to be heard on July 30, 2019. Mr. Heath agreed to this date and to the timetable that was approved that day which, according to the presiding judge’s endorsement, could be changed on consent without further order as long as the materials were filed in accordance with the Rules of Civil Procedure. Mr. Heath’s responding materials were due on April 30, 2019 but he did not deliver them.

[9] There was another attendance in Civil Practice Court on July 26, 2019. Mr. Heath attended through telephone conference. Mr. Heath requested an adjournment of TIFF’s summary judgment motion which was granted. The motion was scheduled to be heard on October 29, 2019 and the parties were directed to agree to a timetable within five days, failing which they were to appear in Civil Practice Court on August 20. The presiding judge ordered that once the timetable is agreed to or ordered, there are to be no further changes. Mr. Heath still did not deliver any responding motion material.

[10] There was a further attendance in Civil Practice Court scheduled for August 27, 2019. Mr. Heath asked counsel for TIFF to reschedule the date for this attendance, but they did not agree to do so. Mr. Heath proposed a new timetable in an email dated August 26, 2019. Counsel for TIFF accepted the proposed timetable subject to extending the date for completion of cross-examinations until October 2, 2019. Mr. Heath agreed to the revised timetable. At the attendance at Civil Practice Court on August 27, 2019 (which Mr. Heath did not attend), the presiding judge made an endorsement that the timetable is peremptory to the plaintiff. The presiding judge explained in his endorsement that “if the plaintiff fails to abide by any of the deadlines in the timetable he will have lost the chance to file materials at a later date. Similarly, the hearing date is final and cannot be changed.” This endorsement was sent to Mr. Heath by email.

[11] Mr. Heath did not deliver any responding motion materials. At the hearing of this motion, Mr. Heath appeared in person. In his submissions, Mr. Heath stated that he had attended at the court office late in the afternoon on September 16, 2019, the last day under the timetable for his responding materials, to have an affidavit sworn, but the court office was unable to assist him because it was too late in the day. Mr. Heath stated that on the following day he attended at Civil Practice Court, without a prior appointment and without notice to TIFF, and addressed the presiding judge who did not make any order or give any direction with respect to Mr. Heath’s unsworn affidavit. Mr. Heath explained that he did not take further steps to deliver responding evidence because of his understanding that the timetable could not be extended.

[12] The endorsement on August 27, 2019 making the agreed upon timetable peremptory was made only after Mr. Heath had failed to comply with the court’s prior timetables for this motion. The presiding judge’s endorsement on August 27 was clear that the hearing date was to be final and could not be changed. Although Mr. Heath is a self-represented litigant, he understood the importance of complying with the timetable that was made peremptory to him.

[13] In these circumstances, I proceeded to hear this motion.

Factual Background

[14] Mr. Heath began working in the Canadian film and television industry in 1990. He was a founder of CITF and one of three directors. Mr. Heath successfully pitched an annual event to TIFF that would serve as a television equivalent to the film festival to be held at the Lightbox theatres beginning in 2013. In respect of the television festival, TIFF and CITF entered into a Venue License Agreement in each of 2013, 2014 and 2015.

[15] The third Venue License Agreement between TIFF and CITF was dated October 14, 2015 (the “2015 Agreement”). Mr. Heath executed the 2015 Agreement on behalf of CITF (named in the 2015 Agreement as “Canadian International Television Festival” and defined as the “Company”).

[16] The 2015 Agreement provides that TIFF grants to CITF a non-exclusive license to use the premises at TIFF Bell Lightbox for the purpose of presenting the event during the scheduled period (November 15 to November 23, 2015), subject to the terms of the 2015 Agreement. The 2015 Agreement provides that CITF shall pay to TIFF a license fee in the amount of $17,000 by November 2, 2015, “failing which TIFF may cancel this Agreement and offer the Designated Premises and Scheduled Period to another party”.

[17] CITF did not pay the licence fee by November 2, 2015. TIFF provided an extension for payment to November 6, 2015, and a second extension to November 9, 2015. Payment was still not received. On November 11, 2015, TIFF’s senior coordinator of event services advised Mr. Heath by email that payment was required to be made in full by the end of day on November 11 or the holds on cinemas would be removed. The license fee was not paid on November 11, 2015.

[18] On November 13, 2015 at 6:44 p.m., Natalie Lue, TIFF’s VP of Production & Visitor Experience, advised Mr. Heath by email that the 2015 Agreement “will be voided and the holds on the venues will be released effective immediately”. She advised Mr. Heath that all contractual deadlines and subsequent extensions of those deadlines have passed without delivery of the required programming content and rental payment. Mr. Heath sent an email in response to Ms. Lue’s email at 10:32 on November 13, 2015 in which he described TIFF’s decision as a “comparatively sudden move by TIFF to severely punish CITF” and suggested that TIFF had alternatives that would not have been “as thoroughly damaging to me and CITF”. Mr. Heath described the decision to void the 2015 Agreement as wrong “fiscally and morally” and to have been made “in error and in spite”.

[19] There was email correspondence between representatives of TIFF and Mr. Heath over the following days. On Sunday November 15, 2015, TIFF made a proposal to Mr. Heath by which TIFF would proceed with one event that was separately contracted with the Writers Guild of Canada and would schedule one day (November 20) for screenings of content that had already been provided. Mr. Heath responded early in the morning of November 16, 2015. He did not accept this proposal.

[20] Further email correspondence between Mr. Heath and TIFF followed. On November 18, 2015, Mr. Heath met with Douglas Allison, TIFF’s Chief Financial Officer, and Ms. Lue during which Mr. Heath discussed the course of action which TIFF would be taking over the next few days with respect to limited screenings that had been planned as part of the television festival. In this conversation, Mr. Allison and Ms. Lue reiterated to Mr. Heath that the 2015 Agreement had been terminated.

[21] On November 18, 2015 Mr. Heath sent an email to Mr. Allison and Ms. Lue in which Mr. Heath expressed that he regarded the tone and attitude directed towards him in the meeting to have been highly disrespectful and contemptuous and he confirmed his understanding that TIFF intended to organize screenings as originally planned by CITF. Mr Heath also asked questions concerning TIFF’s plans for the television festival. In response, Mr. Allison confirmed that TIFF had cancelled its agreement with CITF and that there is no ongoing relationship between TIFF and CITF. Mr. Heath replied with an email expressing concern about TIFF putting on CITF’s festival.

[22] Without further involvement from Mr. Heath or CITF, TIFF went ahead with limited screenings for content that had been received, or was contracted separately, such as the Writers Guild of Canada screening.

[23] On November 20, 2017, Mr. Heath sent an email to several TIFF employees in which he advised that he is taking legal action against TIFF for various wrongful acts towards him which occurred “during the entire third annual CITF in 2015”. Mr. Heath advised that a statement of claim would be issued by 5:00 p.m. that day. In his email, Mr. Heath stated that in 2015, CITF ran from November 17 to 21 and “thus my Claim must be issued today by 5 pm, the final day of the Statute of Limitations”.

[24] On November 21, 2017 Mr. Heath followed up with another email to Mr. Allison and other TIFF employees in which he stated that it would still be possible to resolve the matter without a lawsuit if TIFF was willing to compensate him for his personal damages. Mr. Heath stated in this email that he had been informed that the period of time for him to have a statement of claim issued “is open but is still very tight”.

[25] No one at TIFF responded to Mr. Heath’s emails.

[26] Mr. Heath commenced this action by a notice of action issued on November 23, 2017. The statement of claim was filed on December 22, 2017.

[27] In the statement of claim, Mr. Heath claims damages for breach of fiduciary duty, damages for breach of contract and for breach of a duty to act honestly in the performance of contractual obligations, damages for intentional infliction of mental distress, damages related to economic loss, damages for negligence, and punitive and exemplary damages. In addition, Mr. Heath claims relief through an order compelling TIFF to make a formal public apology, and an order that TIFF invest in a new venture of his on terms which will include TIFF’s participation in a TV festival during the week prior to TIFF’s film festival in September 2018 on terms to be agreed upon or, if no agreement is reached on the terms of Mr. Heath’s venture by March 1, 2018, that TIFF will pay him a fee of $150,000.

[28] Mr. Heath pleads the wrongful conduct upon which his claim is based in paragraph 3 of the statement of claim:

However, while the year 2015 was a difficult and extraordinary one in many ways for CITF and the TV Industry (upon which it relied), and even for TIFF, the November 2015 edition of CITF at the Lightbox and the almost two years which followed were a disaster for David due to TIFF’s sudden breaches of its fiduciary duty and other obligations towards him, and its deliberate and outrageous conduct towards him personally.

Analysis

[29] TIFF moves for summary judgment. TIFF submits that there is no genuine issue requiring a trial with respect to Mr. Heath’s claim. Specifically, TIFF submits:

a. Mr. Heath’s claim is statute barred because his action in respect of this claim was commenced after the second anniversary of the day on which the claim was discovered.

b. If Mr. Heath’s claim is not statute barred, Mr. Heath lacks capacity to sue TIFF personally because all of the causes of action pleaded are founded on the 2015 Agreement, and there is no privity of contract between TIFF and Mr. Heath in respect of the 2015 Agreement.

c. If Mr. Heath has capacity to sue, (i) there was no breach of the 2015 Agreement by TIFF; (ii) TIFF did not owe a duty of care to Mr. Heath; and (iii) TIFF did not owe any fiduciary duty to Mr. Heath.

[30] Mr. Heath made oral submissions at the hearing of the motion. Mr. Heath described what he considered to have been an egregious power imbalance between him and TIFF. It is clear that Mr. Heath feels that he was badly hurt, personally and professionally, by TIFF’s decision to treat the 2015 Agreement as void, which he described as an abuse of power. Mr. Heath described his shock at this decision given that, on prior occasions in 2013 and 2014, TIFF had excused late payment of fees due in respect of the CITF television festival. Mr. Heath stated that he considered the 2015 Agreement to be only a “formality” and that it did not define his relationship with TIFF. Mr. Heath submitted that the factual circumstances of his action, including TIFF’s dominant position in the Canadian film and television market, the complex regulatory framework for the Canadian film and television industry (that, he stated, did not apply in the same way to festivals which are largely unregulated), and the public interest element of his action, raise genuine issues requiring a trial.

General principles

[31] A defendant may, after delivering a statement of defence, move with supporting affidavit material or other evidence for summary judgment dismissing all or part of the claim in the statement of claim: Rule 20.01(3) of the Rules of Civil Procedure.

[32] In response to affidavit material or other evidence supporting a motion for summary judgment, a responding party may not rest solely on the allegations or denials in the party’s pleadings, but must set out, in affidavit material or other evidence, specific facts showing that there is a genuine issue requiring a trial: Rule 20.02(2).

[33] Parties are required to “put their best foot forward” on a motion for summary judgment. The motion judge is generally entitled to take it that the evidence on the motion for summary judgment contains all of the evidence the parties would present at trial: Sweda Farms Ltd. v. Egg Farmers of Ontario, 2014 ONSC 1200 at paras. 26, 27, 32, and 33; aff’d 2014 ONCA 878.

[34] On a motion for summary judgment, the court shall grant summary judgment if the court is satisfied that there is no genuine issue requiring a trial with respect to a claim or defence: Rule 20.04(2).

[35] In Hryniak v. Maudlin, 2014 SCC 7, [2014] 1 S.C.R. 87, the Supreme Court of Canada held at para. 66 that on a motion for summary judgment, the judge should first determine if there is a genuine issue requiring a trial based only on the evidence before the judge, without using the new fact-finding powers in the Rules of Civil Procedure. There will be no genuine issue requiring a trial if the summary judgment process provides the judge with the evidence required to fairly and justly adjudicated the dispute and is a timely, affordable and proportionate procedure. If there appears to be a genuine issue requiring a trial, the judge should then determine if the need for a trial can be avoided by using the new powers under Rules 20.04(2.1) and (2.2). The judge may, at his or her discretion, use those powers, provided that their use is not against the interest of justice. Their use will not be against the interest of justice if they will lead to a fair and just result and will serve the goals of timeliness, affordability and proportionality in light of the litigation as a whole.

Is there a genuine issue requiring a trial in relation to whether Mr. Heath’s claim is statute barred?

[36] Sections 4 and 5 of the Limitations Act, 2002 provide:

4 Unless this Act provides otherwise, a proceeding shall not be commenced in respect of a claim after the second anniversary of the day on which the claim was discovered.

5(1) A claim is discovered on the earlier of,

(a) the day on which the person with the claim first knew,

(i) that the injury, loss or damage had occurred,

(ii) that the injury, loss or damage was caused by or contributed to by an act or omission,

(iii) that the act or omission was that of the person against whom the claim is made, and

(iv) that, having regard to the nature of the injury, loss or damage, a proceeding would be an appropriate means to seek to remedy it; and

(b) the day on which a reasonable person with the abilities and in the circumstances of the person with the claim first ought to have known of the matters referred to in clause (a).

(2) A person with a claim shall be presumed to have known of the matters referred to in clause (1)(a) on the day the act or omission on which the claim is based took place, unless the contrary is proved.

[37] Where there are no material facts in dispute, it is open to the court to decide a limitation period issue on a motion for summary judgment: Jack v. Canada (Attorney General), 2004 6217 (ON SC), 2004 CarswellOnt 3255 at paras. 101-103.

[38] The items listed in s. 5(1)(a) are conjunctive. The limitation period does not begin to run until “the putative plaintiff is actually aware of all of those matters or until a reasonable person, with the abilities and in the circumstances of the plaintiff, first ought to have known of all of those matters”: Longo v. MacLaren Art Centre Inc., 2014 ONCA 526 at para. 41.

[39] Mr. Heath’s claim is based on TIFF’s act of electing to treat the 2015 Agreement as void. This took place on November 13, 2015 when Ms. Lue so notified Mr. Heath. Pursuant to s. 5(2) of the Limitations Act, 2002, Mr. Heath is presumed to have known of the matters referred to in clause 5(1)(a) on that day. The evidence is clear that Mr. Heath received Ms. Lue’s email that day because he responded to it that evening. The onus falls on Mr. Heath to establish that he did not know of the matters referred to in s. 5(1)(a) until a later date than November 13, 2015: Conde v. Ripley, 2015 ONSC 3342 at para. 53. Mr. Heath did not file any evidence on this motion, and he has not rebutted the presumption that arises from s. 5(2) of the Limitations Act, 2002.

[40] Where it is known that legal proceedings are appropriate and the issue is whether or not the claim can be settled, ongoing communications, investigations or negotiations do not postpone the commencement of the limitation period: Presley v. Van Dusen, 2019 ONCA 66 at para. 25. The fact that Mr. Heath and TIFF engaged in communications after November 13, 2015 to attempt to resolve the dispute arising from TIFF’s election to treat the 2015 Agreement as void, including through TIFF’s email sent on November 15, 2015 with a proposal for resolution, does not postpone the commencement of the limitation period.

[41] I conclude that Mr. Heath’s claim was discovered on November 13, 2015. This action was commenced more than two years after this date. It is statute barred.

[42] In Mr. Heath’s email dated November 20, 2017 he stated that he is “taking legal action against TIFF for various wrongful acts towards me which occurred throughout the entire 3rd annual CITF in 2015”. In this email, Mr. Heath acknowledged that he was aware of the statute of limitations. The television festival which took place in 2015 was from November 17 to November 21, 2015. If, contrary to my conclusion that Mr. Heath’s claim was discovered on November 13, 2015, the limitation period only began to run on November 21, 2015, the day the television festival ended, Mr. Heath’s action was commenced more than two years after this date, and it would still be statute barred.

[43] There is no genuine issue requiring a trial with respect to whether Mr. Heath’s action was commenced more than two years after Mr. Heath’s claim was discovered.

Is there a genuine issue requiring a trial in relation to whether TIFF is liable to Mr. Heath for breach of contract, negligence, or breach of fiduciary duty?

[44] TIFF submits, in the alternative, that if the action is not statute barred, there is still no genuine issue requiring a trial in relation to whether TIFF is liable to Mr. Heath for breach of contract, negligence, or breach of fiduciary duty. Although I have concluded that there is no genuine issue requiring a trial in relation to whether Mr. Heath’s action is statute barred, I go on to address TIFF’s other submissions.

[45] Mr. Heath claims damages for breach of contract and breach of the duty to act honestly in the performance of contractual obligations. Mr. Heath was not a party to the 2015 Agreement. The 2015 Agreement was made between TIFF and CITF, a company of which Mr. Heath was a director.

[46] The common law doctrine of privity of contract stands for the proposition that no one but the parties to a contract can be bound by it or entitled under it. This doctrine is an established principle of contract law, but it has considerably diminished force in Canada and persists only in weakened form: Brown v. Belleville (City), 2013 ONCA 148 at paras. 73, 79.

[47] In Greater Toronto Airports Authority v. Mississauga (City), 2000 CarswellOnt 4113, the Supreme Court of Canada confirmed that the ordinary rule is that a stranger to a contract cannot claim a right under that contract. The Supreme Court of Canada, at para. 82, identified exceptions to the privity rule where a party to a contract has acted as an agent for the stranger in acquiring the contractual rights, a party to the contract has constituted himself trustee of the contractual rights for the benefit of the stranger, and where employees of a party to the contract were clearly intended to receive the benefit of an exclusion of liability relating to their employer in circumstances where the employees were acting in the course of their duties for that employer on matters under the contract. None of these exceptions apply to Mr. Heath.

[48] Mr. Heath is not a party to the 2015 Agreement. The common law doctrine of privity of contract applies in the circumstances of this action. There is no genuine issue requiring a trial in respect of whether Mr. Heath lacks standing to make a claim against TIFF for breach of the 2015 Agreement.

[49] The 2015 Agreement included a term which required CITF to pay the License Fee of $17,000 by November 2, 2015 failing which TIFF may cancel the 2015 Agreement. CITF did not pay the License Fee by the date required under the 2015 Agreement, or by any of the later dates offered by TIFF. In such circumstances, under the 2015 Agreement, TIFF was contractually entitled to notify CITF that it elected to treat the 2015 Agreement as void, and it did so. There is no evidence which raises a genuine issue requiring a trial in relation to whether TIFF breached the 2015 Agreement by electing to treat the 2015 Agreement as void.

[50] The evidence is clear that CITF was in a contractual relationship with TIFF through the 2015 Agreement, and Mr. Heath’s dealings with TIFF in relation to the 2015 Agreement were as a representative of CITF. There are no facts in evidence which show that TIFF owed a duty of care to CITF or to Mr. Heath. There is no genuine issue requiring a trial in relation to Mr. Heath’s claim against TIFF in negligence.

[51] Mr. Heath also claims damages against the TIFF based upon breach of an alleged fiduciary duty. Fiduciary duty is a doctrine originating in trust. It requires that one party, the fiduciary, act with absolute loyalty toward another party, the beneficiary or cestui que trust, in managing the latter’s affairs: Elder Advocates of Alberta Society v. Alberta, 2011 SCC 24 at para. 22. The relationship between TIFF and Mr. Heath does not fall into a traditionally recognized category in which a fiduciary duty may arise. For an ad hoc fiduciary duty to arise, the claimant must show, in addition to vulnerability arising from the relationship, (i) an undertaking by the alleged fiduciary to act in the best interests of the alleged beneficiary or beneficiaries; (ii) a defined person or class of persons vulnerable to a fiduciary’s control (the beneficiary or beneficiaries); and (iii) a legal or substantial practical interest of the beneficiary or beneficiaries that stands to be adversely affected by the alleged fiduciary’s exercise of discretion or control: Alberta at para. 36.

[52] There is no evidence that TIFF undertook to act in Mr. Heath’s best interests. Mr. Heath’s relationship with TIFF was as a representative of CITF, a company with which TIFF had a contractual relationship.

[53] There is no genuine issue requiring a trial in relation to whether TIFF owed a fiduciary duty to Mr. Heath.

[54] The other claims made by Mr. Heath, for an apology by TIFF, and requiring TIFF to enter into a new agreement with him or pay a fee, are not available to Mr. Heath on the evidence before me. There is no genuine issue requiring a trial in relation to these claims.

Disposition

[55] For the foregoing reasons, I am satisfied that there is no genuine issue requiring a trial with respect to Mr. Heath’s claims. TIFF’s motion for summary judgment is granted and Mr. Heath’s action is dismissed.

[56] TIFF seeks costs of the motion and the action on a partial indemnity scale.

[57] TIFF seeks costs of the motion in the amount of $16,628.50 comprised of fees of $12,628.50, appearance fee of $933.75, disbursements (including HST) of $918.62 and HST on fees. Most of the services for which fees are claimed was done by second counsel who was called to the bar in 2012. The fees are calculated based upon 75% of counsel’s actual hourly rates.

[58] In addition, TIFF claims costs of the action (excluding costs claimed for the motion for summary judgment) for services provided for pleadings and documentary discovery in the amount of $5,800.50 plus HST on fees and disbursements (inclusive of HST) of $1,233.40.

[59] TIFF relies upon an offer to settle made in a letter to Mr. Heath dated July 25, 2018 in which it offered to waive its claim for legal costs in exchange for a dismissal of the action. This offer was not accepted.

[60] As the successful party, TIFF is entitled to costs on a partial indemnity scale. I have considered the factors in Rule 57.01(1) and the principles in Boucher v. Public Accountants Council for the Province of Ontario (2004), 2004 14579 (ON CA), 71 O.R. (3d) 291 (C.A.) at para. 24. In my view, a fee of $15,000 on a partial indemnity scale for the action, including the motion for summary judgment, is a fair and reasonable amount that should be paid by Mr. Heath. I allow the disbursements as claimed. I fix fees and disbursements, inclusive of HST on fees and disbursements, at $18,189.90 to be paid by Mr. Heath to TIFF within 30 days.

Cavanagh J.

Date: November 4, 2019

Heath v. Toronto International Film Festival Inc., 2019 ONSC 6365

Case Summary

Introduction

Procedural Background

Factual Background

Analysis

General principles

Is there a genuine issue requiring a trial in relation to whether Mr. Heath’s claim is statute barred?

Is there a genuine issue requiring a trial in relation to whether TIFF is liable to Mr. Heath for breach of contract, negligence, or breach of fiduciary duty?

Disposition

Judge

Counsel

Parties

Areas of Law

Fact Patterns

Financial Outcomes

Issues

Statutory Provisions 3

Legal Tests 3