Thursday, November 24, 2011

P.E.I. Music v. Gov't. P.E.I. & HRC, 2011 PECA 18

In P.E.I. Music v. Gov't. P.E.I. & HRC, 2011 PECA 18, the Prince Edward Island Court of Appeal considered whether the statutory one-year limitation period in section 22(2)(b) of the P.E.I. Human Rights Act begins to run on the date of the alleged act, or when the material facts upon which the complaint is based have been discovered or ought to have been discovered by a complainant with the exercise of reasonable diligence, as per the common law discoverability rule. The Court found that the common law discoverability rule applies to the Act, so the respondents were not barred from bringing their suit by the statutory limitation period.

In 1991, the Liberal Government legalized video gambling, and through the Atlantic Lottery Corporation, licensed P.E.I. Music to supply and maintain video lottery terminals (VLTs) in bars and stores. In 2002, the Conservative Government took over the VLT business from P.E.I. Music and cancelled their license by legislation. P.E.I. Music was not compensated, although other retailers whose licenses were canceled were. In April 2007, P.E.I. Music, whose owners were well known Liberal Party supporters, made a complaint to the Human Rights Commission that the Government had discriminated against them in a matter of employment on the basis of political belief. The Commission dismissed the complaint on the basis of the s. 22(2)(a) statutory limitation period, and P.E.I. Music's application for judicial review was then granted by the applications judge. The Government appealed to the P.E.I. Court of Appeal.

Applying a purposive approach to the question of statutory interpretation, the Court noted that human rights legislation has a special status above other laws of the province. The Court reasoned that, given that human rights legislation should be interpreted in a “liberal and purposive manner” and such legislation’s quasi-constitutional nature, it would be “unjust to a claimant to terminate the cause of action before the claimant becomes aware of it”. Since the complainant bears the onus of proving discrimination, and this can only be done with knowledge of the impugned act, if follows that the common law discoverability rule must apply to s. 22(2)(b).

November 24, 2011
Link to Decision

Catherine Marchant & Alexa Mingo
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R. v. Nguyen, 2011 BCCA 471

In this case, the British Columbia Court of Appeal considered what form an order of forfeiture should take in the forfeiture provisions of the Controlled Drugs and Substances Act, S.C. 1996, c. 19, as amended. The court held that an order of forfeiture should take the form of “property” rather than a “financial interest” in property, and accordingly allowed the appeal in part.

Both respondents were convicted of charges relating to marijuana offences. At the sentencing hearings, the trial judges ordered a forfeiture of a financial interest in their residential properties. The Court of Appeal set aside the form of the trial judges’ forfeiture orders, although the court affirmed the scope of the orders. The court relied on contrasting terminology in ss.19 and 19.1 and s.20: the former two employ “property” whereas s.20 refers to an “interest.” Additionally, orders in the form of financial interests would tend to blur the distinction between the sentencing process and the forfeiture process, a distinction that the Supreme Court stated  was necessary to maintain in R. v. Craig, 2009 SCC 23. Finally, the court rejected the financial interest form because this process would unduly prolong the criminal process.

November 24, 2011
Link to Decision

Fidelia Ho
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Wednesday, November 16, 2011

Canada (National Revenue) v. Canada, 2011 FCA 314

In this case the Federal Court of Appeal considered whether an entitlement to remuneration based on a per diem rate established in advance is a “fixed or ascertainable stipend or remuneration” within the context of the Canada Pension Plan, when it is not possible to determine in advance how many days of service will be required. The Court held that such remuneration meets that definition.

By the combined operation of ss. 2 (definition of “office”) and 6 of the Canada Pension Plan and s. 24 of the Canada Pension Plan Regulations a member of the Ontario Judicial Appointments Committee is engaged in pensionable employment if that position carries the entitlement to a “fixed or ascertainable stipend or remuneration.” Having acknowledged that there is inconsistent case law on the subject, Sharlow J.A. determined that there is “nothing in the language of the definition of “office" read in its statutory context, that justifie[d] the Court in interpreting the phrase “fixed or ascertainable” to require an advance determination of the total remuneration for a particular year.” Sharlow J.A. thus concluded that “a legal entitlement to a per diem rate of remuneration established in advance is sufficiently “fixed or ascertainable” to meet the statutory test.”

November 16, 2011
Link to Decision

Rebecca Crangle & Alexa Mingo
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Tuesday, November 15, 2011

Howalta Electrical Services Inc. v. CDI Career Development Institutes Ltd., 2011 ABCA 234

In this case, the Alberta Court of Appeal considers whether a defendant in a tort suit may seek contribution from an alleged co-defendant under the Alberta Tort-Feasors Act, when the original plaintiff is barred from bringing suit against this co-defendant for reasons which do not negate fault. The issue arises from a fire that destroyed a building occupied by the tenant. The insurance company paid out the owner of the building and brought a subrogated suit against contractors who were working in the building (defendant) and the tenant of the building (co-defendant). The contractors allegedly caused the fire through negligence, while the tenants allegedly failed to notify the landlord when the smoke/fire was discovered, in violation of the lease. The subrogated suit against the tenant was discontinued upon discovery that the tenant contributed to payment of the insurance in accordance with the lease and so the suit was barred. The contractors issued notices seeking contribution and indemnity from the tenant under the Tort-Feasors Act.

The section of the Tort-Feasors Act at issue in this appeal is s. 3(1)(c), which allows a tort-feasor to “recover contribution from any other tort-feasor who is or would, if sued, have been liable in respect of the same damage, whether as a joint tort-feasor or otherwise…” The majority opinion of the court, delivered by Côté J., interpreted the pre-condition to recovery as requiring that the co- defendant (or “other tort-feasor”) be liable to the original plaintiff. This interpretation was based on an understanding of the world “liable” as including an element of enforceability and requirement of performance. Côté J. also looked to case law, and instances where procedural bars to bringing suit against the tort- feasor directly barred indemnity claims. Finally, Côté J. noted that “this bar to indemnity claims makes the law consistent. Someone not directly liable to the plaintiff should not be liable in a suit brought by the plaintiff, and so indirectly have to pay the plaintiff on the forbidden claim. The plaintiff and the defendant claiming contribution cannot do indirectly what is forbidden directly.” The court thus allowed the appeal, dismissing the claim for contribution.

O’Ferrall J. provided separate reasons, concurring in the result. O'Ferrall J. first noted that the Act at issue was enacted for the purpose of removing the common law 'rule' preventing tort-feasors from seeking contribution from other tort-feasors. As such, interpreting the legislation so that it likewise prevents proper sharing of liability is contrary to legislative intent. Additionally, O’Ferrall J. pointed to the words “whether as a joint tort-feasor or otherwise” in the section, and concluded that the “otherwise” refers to situations when the party from whom contribution is sought is not a joint tort-feasor, but nevertheless may be liable for all or part of the same damage/ harm. Consequently, O’Ferrall J. interpreted s. 3(1)(c) as permitting contribution from the co-defendant tort-feasor provided that the co- defendant is liable to either the plaintiff or to the defendant seeking contribution, so long as harm to the plaintiff is the same. The claim for contribution was dismissed because there was no pleadings or evidence suggesting that the tenant would have been liable to the contractors.

November 15, 2011
Link to Decision

Rebecca Crangle
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Thursday, November 10, 2011

Imperial Tobacco Canada Limited v. Canada, 2011 FCA 308

In this case, the Federal Court of Appeal held that payments made by a company to its own employees for surrendering options to acquire the appellant’s shares in the context of a capital reorganization were payments "on account of capital" and therefore could not be treated as employee compensation for income tax purposes and deducted pursuant to the federal Income Tax Act.

The payments were made to employees who held rights under an employee stock option plan in order to facilitate a “going private transaction” under which an acquirer would acquire all of the appellant’s shares held by public shareholders. Justice Sharlow found that terminating the appellant’s obligations under the stock option plan facilitated the proposed capital organization, and this constituted a payment on account of capital, being a “once and for all payment” that resulted in a benefit “of an enduring nature.” Accordingly, Justice Sharlow upheld the decision of the Tax Court that the payments were on account of capital, finding no palpable and overriding error in the Tax Court’s conclusions on such a question of mixed law and fact.

November 10, 2011
Link to Decision

Grant Bishop
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Tuesday, November 1, 2011

Gill v. Hurst, 2011 NSCA 100

In this case, the Nova Scotia Court of Appeal resolved a conflict between the Land Registration Act ("LRA") and the Matrimonial Property Act ("MPA") regarding the division of the matrimonial home between a law firm holding a charge against one divorced party's interest in the home, and that party's ex-spouse who was owed an equalization payment as a result of the divorce. The Court held that the law firm's charge took priority because the judgment creating the charge was entered prior to the judgment creating the equalization payment, and the trial judge could not displace the firm's charge or impair its priority through the exercise of its equitable discretion.

The dispute arose when the respondent's wife initiated divorce proceedings against him. The respondent retained Wickwire Holm, a law firm, to represent him in the proceedings, but later fired the firm. On July 27, 2009, Wickwire Holm had a judgment of $67,405.23 for unpaid legal fees entered against the respondent. On August 5, Wickwire Holm entered the judgment under the Land Registration Act, which gave the firm a charge over Mr. Gill's interest in the matrimonial home, held in joint tenancy with his wife. On October 10, 2010, the trial judge resolved the divorce proceedings, granting the respondent's wife a share of the respondent's joint tenant interest as part of an equalization payment.

Bryson, J.A. rejected the trial judge's determination that the respondent's ex-wife's claim to the respondent's joint tenant interest took priority over the Wickwire Holm judgment. The trial judge reasoned that the ex-wife's claim had priority because she had an equitable claim to the respondent's share, and she put Wickwire Holm on notice that she would be pursuing this claim. Noting that the ex-wife's proprietary interest in the respondent's joint tenant interest arose well after the Wickwire Holm judgment, Bryson, J.A. stated that the trial judge improperly exercised its discretion to rearrange existing property rights. The trial judge exercised equitable jurisdiction, but Bryson, J.A. held it did so improperly because equitable discretion requires that the court recognize a pre-existing property right. In divorce actions under the MPA, no such rights are created until the court makes an order creating the rights. Otherwise, there is a statutory presumption of equal ownership under the MPA.

In light of this determination, Bryson, J.A. held that the issue of whether notice was given to the ex-wife by Wickwire Holm was irrelevant.

Bryson, J.A. pointed out that the decision has the effect of allowing the respondent to grant his lawyer a mortgage over his interest in the matrimonial home indirectly, even though a direct granting of this interest is prohibited under the MPA. However, he reasoned that this prohibition under the MPA does not extend to blocking the statutory remedy granted under the LRA.

In dissent, Fichaud, J.A. characterized the respondent's actions in accruing debt to Wickwire Holm and allowing the law firm to register a charge against his interest in the matrimonial home as the creation of an "encumbrance" on the matrimonial home. Since the MPA, section 10(1)(d), grants the court discretion to set aside any such encumbrance, Fichaud, J.A. reasoned that the trial court was within its jurisdiction to set aside Wickwire Holm's claim in favour of the claim of the ex-wife. He would have dismissed Wickwire Holm's appeal.

 November 1, 2011
Link to Decision

Kai Sheffield & Katerina Svozilkova
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