Monday, January 30, 2012

This Week at the Ontario Court of Appeal - January 30, 2012

Each Week Wise Blog analyzes recent decisions from the Ontario Court of Appeal.

Placzek v. Green

The respondent, Carmen Placzek, was severely injured in a rear end collision. The appellant, Albert Green, was the driver of the vehicle that struck the respondent's vehicle. The respondent suffered from a severe case of fibromyalgia for many years prior to the accident. At trial, the appellant claimed that the fact that the respondent's physical problems affected her life after the accident was attributable to her fibromyalgia and not to the minor accident involving the parties.

At the outset of the trial, the trial judge struck the jury. She concluded that the appellant was liable. Moreover, the trial judge asserted that the injuries that the respondent suffered as a result of the accident caused her significant problems. As a result, the trial judge awarded the respondent $919,237 in damages, with a large portion going for her lost income and loss of future earnings.

There were two primary grounds of appeal submitted by the appellant. The first was the trial judge's decision to discharge the jury. The Court noted that the decision to discharge a jury is a discretionary one and they will defer to that exercise of discretion unless its exercise was characterized as arbitrary, capricious or unreasonable. The trial judge's decision to discharge the jury related to the complexity regarding various aspects of the evidence. For instance, since the respondent was a self-employed realtor, there were numerous factual variables that complicated the quantum of that claim. Also, there was complex medical, engineering and biomedical evidence. The Court did state, however, that trial judge erred by expressing concerns that the appellant's position on liability had an influence in striking the jury. Nevertheless, the Court was satisfied that the trial judge made it clear that his decision to strike the jury was associated with the complexity of the evidence.

The appellant's second ground of appeal concerned the trial judge's assessment of damages. Specifically, the appellant contended that the trial judge failed to quantify the damages based on a critical assessment of the evidence and instead picked a point somewhere in the middle between the various scenarios advanced by the parties. In rejecting the appellant's position, the Court declared that the trial judge correctly decided that the respondent's post-accident issues were attributable to the accident. The respondent's working life was shortened as she would only be able to work part time. The Court held that these findings were reasonably available on the evidence and impacted the quantum of damages, particularly damages relating to the calculation of the respondent's loss of income and future earnings.

North York Family Physicians Holdings Inc. v. 1482241 Ontario Limited

This appeal was based on a landlord-tenant dispute. The appellant, landlord, was the owner of a multi-storey office building and parking facility. The respondent, tenant, was a holding company that was created for the purpose of holding the lease. Its business was subletting the leased premises to Shoppers Drug Mart and operating 181 parking spaces. Additionally, the visitor parking area consisted of 156 parking spaces and was designated in the lease as patient parking for North York Family Health Team Inc., a company operated by the respondent, not Shoppers Drug Mart customers.

The appellant raised three issues on appeal. The first issue concerned the commencement date of the lease. The Court found no error in the application judge's analysis of this issue. The term "premises" included the demising walls. Two provisions contained in the lease dealt with the commencement date and both were based on delivery of the premises by the landlord. The demising walls were not constructed until June 22, 2009. As a result, the lease did not commence until the said date when the "premises" were delivered.

The second issue raised by the appellant related to the commencement date for the payment of rent for the parking spaces. The appellant's position was that the parking rent commencement date was April 2009. The Court noted that although the application judge erred in the interpretation of the term "tenant business" to mean the business of the sub-tenant, Shoppers Drug Mart, the judge nevertheless reached the correct verdict in the context of Article 4.02 of the lease. The Court reviewed the evidence and found that both parties treated the parking spaces as not turned over by the appellant until August 2009. Moreover, the appellant did not invoice the respondent for parking before the said date and also collected parking revenues until August 1, 2009 from the parking spaces that were leased to the tenant. 

The Court held that the application judge did not err in her decision that the rent for parking spaces did not commence prior to August 2009. It was clear that the tenant's business (operating leased parking spaces) did not commence prior to August 2009.

The final issue advanced by the appellant was the landlord's obligation to pay the leasehold improvements allowance and whether that amount should be paid directly to the respondent or Shoppers Drug Mart. The application judge held that the appellant was required to pay the leasehold improvements to the tenant. However, the Court stated that in oral argument, both counsel agreed that the amount should be paid directly to Shoppers Drug Mart. Thus, the order of the application judge required amendment.

Musselman v. 875667 Ontario Inc. (Cities Bistro)

The primary issue on appeal was whether the respondent, landlord, was considered to be an occupier of the leased premises within the definition of "occupier", pursuant to the Occupiers' Liability Act ("Act"). The appellant slipped and fell on the stairs leading from the bathrooms to the main floor of the restaurant and suffered severe injuries. The question on appeal did not concern the trial judge's interpretation of "occupier" but rather the treatment of relevant evidence.

Counsel for the appellant argued that the trial judge misinterpreted three aspects of the evidence. Two of the misinterpretations concerned the substance of the evidence provided by the tenant, Brian Heasman. The appellant contended that Mr. Heasman's evidenced established that the respondent demonstrated the necessary responsibility for control over the premises to qualify it as an "occupier" under the Act. Furthermore, the appellant submitted that the trial judge misunderstood the meaning of clause 6 in the operative lease between the parties. Specifically, the appellant argued that clause 6 placed inspection and repair responsibilities on the respondent, thereby giving it sufficient control and responsibility over the premise to make it an "occupier" under the Act. 

Regarding paragraph 6 of the parties' lease, the trial judge held that Mr. Heasman had complete responsibility for repair and maintenance of the premises. The Court asserted that the trial judge carefully examined the contents of the entire lease and correctly concluded that paragraph 6 put complete responsibility on the tenant for repair and maintenance. They also accepted the respondent's submission that the exclusion of "wear and tear" from Mr. Heasman's responsibility to maintain and repair did not place any obligation on the respondent to repair and inspect the property. Further, the Court noted that the lease alone was not determinative of the trial judge's decision that the respondent was not an occupier under the Act. The conduct of the parties over the previous years and the fact that they were in a landlord/tenant relationship was significant factor in the trial judge's determination whether the respondent was considered an occupier.

Additionally, counsel for the appellant raised the argument in his factum that the respondent could be liable for negligence aside from any negligence associated as an occupier. Since counsel did not make an oral argument in support of this submission and the fact the trial judge held the respondent was not an occupier under the Act, the Court found no reasonable basis to conclude that respondent was liable in negligence.

- Alim Ramji, Toronto
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