Sean Dewart

This five-judge appeal reconsidered the common law governing non-disclosure of partial settlement agreements in multi-party civil litigation.

The court held that the prior rule mandating an automatic finding of abuse of process and an automatic stay, without proof of prejudice or regard to proportionality, was wrongly decided and should be overruled.

The proper approach requires a contextual and discretionary abuse of process analysis focused on unfairness, prejudice, oppression, harm to the administration of justice, and a proportionate remedy, with r. 49.14 of the Rules of Civil Procedure reinforcing that framework.

Applying that approach, the court allowed two appeals and remitted those matters, while dismissing two others where the record was sufficient to determine the result.

The Law Society brought a motion for an interlocutory suspension of the respondent lawyer's licence amid allegations of misappropriating approximately $256,000 from an incapacitated client while acting as power of attorney.

The lawyer admitted to borrowing money from the client in breach of the Rules of Professional Conduct and misleading the client's family and bank.

The Tribunal found reasonable grounds to believe there was a significant risk of harm to the public.

It initially granted an interim restriction allowing the lawyer to complete one scheduled trial, followed by a full interlocutory suspension.

The third party brought a motion to set aside a noting in default.

The third party had previously obtained a waiver or extension of time to deliver a defence from the defendant's former counsel.

The defendant's new counsel noted the third party in default without providing any notice or requesting the defence.

The court found this constituted sharp practice and a breach of professional obligations.

The motion was granted, the noting in default was set aside, and the defendant was ordered to pay substantial indemnity costs of $9,600.

The applicants sought declarations that their 82-year-old mother lacked capacity to manage her property and personal care, and orders invalidating testamentary documents she executed in October 2024.

Relying on a court-ordered capacity assessment, the court found the mother had been incapable of managing property and personal care, granting a power of attorney for property, instructing counsel, and possessing testamentary capacity since at least July 2024 due to moderate dementia.

The court declared the October 2024 documents invalid due to lack of capacity and undue influence by her common-law spouse, and affirmed the validity of her prior testamentary documents.

The court also held it had jurisdiction to declare the will invalid while the testator was still alive given she was not expected to regain capacity.

The plaintiff general contractor moved for summary judgment to dismiss the defendant City's set-off defences.

The City's counterclaim had previously been permanently stayed due to an abuse of process for failing to disclose settlement agreements with third-party subtrades.

The City subsequently amended its defence to plead both legal and equitable set-off based on the same allegations.

The court granted the motion, finding that legal set-off was unavailable because the City's claims were for unliquidated damages rather than debts.

The court also dismissed the equitable set-off defence, holding that it would be manifestly unjust to allow the City to resurrect claims through a set-off defence that had been permanently stayed for abuse of process.

Following a finding of professional misconduct regarding syndicated mortgage transactions, the Law Society Tribunal considered the issue of costs.

The Law Society sought $60,000 in costs, while the respondent lawyer argued for $25,000.

The Tribunal reviewed the principles of costs awards in disciplinary proceedings, emphasizing that while the profession should not bear all costs, reductions are appropriate to recognize cooperative conduct that shortens proceedings.

Given the lawyer's extensive cooperation, including agreeing to a comprehensive agreed statement of facts, the Tribunal reduced the costs award to $25,000.

The appellants appealed the dismissal of their motion to set aside a 2014 consent dismissal and underlying settlement of a personal injury action.

The settlement was negotiated by their former lawyer, who misappropriated the funds and failed to obtain court approval under Rule 7.08 for the injured plaintiff, who was a party under disability.

The Court of Appeal upheld the motion judge's decision, finding she correctly applied the Book factors.

The insurer had acted in good faith without knowledge of the disability, and the settlement itself was not unreasonable.

The court held that the lawyer's fraud did not impugn the reasonableness of the settlement from the perspective of the tort claim.

The applicants sought judicial review of a decision by the Registrar under the Funeral, Burial and Cremation Services Act, 2002, which refused to fully reimburse their costs for a burial site investigation.

Human remains were discovered on the applicants' property during a Stage 4 archaeological assessment, prompting the Registrar to order a burial site investigation.

The Registrar later found the investigation caused an undue financial burden and agreed to reimburse costs, but limited the reimbursement to a fraction of the claimed amount, attributing the rest to the Stage 4 assessment.

The Divisional Court found the Registrar's decision unreasonable, as it disregarded prior directions that expanded the scope of the burial site investigation and relied on a faulty tool-based analysis to differentiate the work.

The decision was quashed and remitted for reconsideration.

The moving party sought leave to appeal the decision of Penman J. dated May 16, 2025.

The Divisional Court dismissed the motion for leave to appeal and ordered the moving party to pay costs of $5,000 to the responding party.

The plaintiff, a German-trained lawyer with a PhD in law, sued his former family law counsel for professional negligence and breach of fiduciary duty arising from their representation in a motion to change a parenting order.

The plaintiff alleged the defendants failed to investigate the facts, warn him of the case's weaknesses and cost risks, and ensure he understood the legal advice.

The defendants represented the plaintiff in a motion to change a 2012 consent order that limited his parenting time with his two sons.

The motion was based on a claimed material change in circumstances—the plaintiff's new employment with reduced travel requirements.

The motion was dismissed by Justice McWatt, who found no material change in circumstances because the plaintiff testified at trial that his new job required international travel, contradicting his affidavit and employer's letter.

The court dismissed the negligence and fiduciary duty claims, finding the defendants met the standard of care, the plaintiff was aware of the risks, and he would have proceeded with the motion regardless of advice.

The defendants brought a motion to stay the proceeding on the ground that the plaintiffs breached the obligation to immediately disclose a settlement agreement with co-defendant Liam Buck that changed the adversarial landscape of the litigation.

The plaintiffs disclosed the settlement on March 17, 2023, but did not provide full details of the agreement, including that Buck would recant his prior evidence.

The court found that the disclosure was inadequate and that the failure to immediately and forthrightly disclose an agreement changing the adversarial orientation constitutes an abuse of process.

The court granted the stay as required by Handley Estate v. DTE Industries Limited, despite acknowledging the harshness of the remedy and the absence of prejudice to the moving parties.

This costs endorsement follows the Law Society of Ontario’s successful motion before the Court of Appeal for Ontario.

The court orders each of the moving parties severally liable for costs of $200, payable to the Law Society of Ontario, on a partial indemnity basis.

The Court of Appeal for Ontario dismissed Lynne Catherine Foulidis’s motion for a panel review and to set aside the Deputy Registrar’s order dismissing her appeal for delay.

The court found that the motion judge correctly concluded the appeal lacked merit and that the criteria for an extension of time to perfect the appeal were not met.

The court reviewed the trial judge’s findings regarding the retainer agreement and legal fees, and found no palpable and overriding error.

Costs were awarded to the respondent.

The court dismissed a motion for partial summary judgment brought by the defendants, Gowling WLG (Canada) LLP and its partners, in a professional negligence action arising from advice and services provided in connection with an employee stock trust and a 2012 financing transaction.

The court found that the case involved complex factual disputes, credibility issues, and conflicting expert evidence regarding the scope of the defendants’ retainer and standard of care.

The court held that summary judgment was inappropriate given the need for a full trial to resolve these issues, and also noted the risk of inconsistent findings due to parallel actions involving related parties and issues.

The Court of Appeal for Ontario dismissed a motion by 13 respondents to re-open an appeal regarding the Law Society of Ontario’s decision to void their licensing exam results and registrations due to exam integrity breaches.

The court found that the moving parties had not been denied judicial review, that their complaint was about the adequacy of reasons rather than a rare circumstance justifying re-opening, and that the interests of justice did not require reconsideration.

The court held that the Law Society’s actions were consistent with its by-laws and that the moving parties’ arguments had been addressed.

The Court of Appeal for Ontario allowed in part the appeal of Westmount-Keele Limited in a solicitor’s negligence action against Nicholas C. Tibollo and his professional corporation.

The court found that the trial judge erred in declining to award damages for certain legal fees and elevator repairs, and varied the judgment to include these amounts.

The court otherwise upheld the trial judge’s findings regarding lost opportunity damages, property taxes, and other claims, finding no palpable and overriding error.

The appeal was allowed in part, and costs were awarded to the appellant.

The applicants sought judgment to enforce the terms of a settlement reached at a judicial pre-trial regarding a disputed strip of land used as a farm access road.

The dispute centered on the precise location of a fence to be constructed as part of the settlement.

The court found that a binding settlement had been reached, memorialized in a written document, and that the parties' subsequent conduct confirmed their agreement.

The court rejected the respondents' arguments of misunderstanding or mistake, holding that there was no evidence of a lack of authority or misapprehension by counsel.

The court granted the motion, enforcing the settlement.

The decision addresses a motion by Gowing Contractors Ltd. and Zurich Insurance Company Ltd. to strike the statement of defence of Walsh Construction Company Canada and Walsh Construction Co., and to stay related actions, on the basis that Walsh failed to immediately disclose a settlement with the City of Toronto in a related action.

The court found that the settlement did not entirely change the litigation landscape of the actions involving Gowing and Zurich, and therefore the immediate disclosure doctrine did not apply.

The motion was dismissed.

The Law Society of Ontario (LSO) appealed a Divisional Court decision that quashed its administrative decision to void the registrations of 20 licensing candidates implicated in a cheating scandal.

The Divisional Court had found the LSO breached procedural fairness by not holding oral hearings before voiding the registrations.

The Court of Appeal allowed the appeal, finding that the Divisional Court misapplied the Baker factors and conflated the LSO's administrative licensing functions with its disciplinary good character functions.

The Court held that the written process provided by the LSO, which included disclosure and multiple opportunities to respond, satisfied the duty of procedural fairness.

The Court also admitted new evidence and found the Divisional Court breached procedural fairness by making costs orders without allowing submissions.

The applicant purchaser sought judicial review of an arbitrator's costs award that ordered him to pay the respondent vendor's legal fees on a substantial indemnity basis following a dismissed arbitration over a cancelled condominium project.

The Divisional Court found it had jurisdiction because the arbitration was mandatory under the Ontario New Home Warranties Plan Act.

The Court held the arbitrator's costs decision was unreasonable and internally inconsistent, as it failed to properly apply the specific costs regime in the Tarion Addendum which presumes the vendor pays the purchaser's reasonable legal expenses absent just cause.

The costs award was quashed and remitted to the arbitrator for reconsideration.