Top 10 Business Decisions of 2016

Last year’s top decisions reflect the continuation of a balanced approach to business. Courts did, however, break ground when it came to jurisdictional issues and class actions

After the disappointing jurisprudential results experienced by Canadian business in 2015, the landscape more than evened out this past year — which is not to say that Canadian appellate courts ignored anti-business arguments: while five of our top 10 business decisions can be regarded as decidedly pro-business, four do not favour the business community, and one decision can be regarded as mixed.

The decision that topped the list, CIBC v. Green, significantly raised the bar for leave to appeal applications in secondary-market securities class actions, and is huge in its impact. Our second choice, Ledcor Construction v. Northbridge Indemnity Insurance, was regarded in many quarters as even more impactful than Green, albeit for its negative impact on business. The decision creates greater exposure to liability for businesses that use standard-form contracts, especially in the insurance and construction industries. Still, it’s the only one in the top five that doesn’t favour business.

The next three — Canada v. Chambre des notaires du Québec; Endean v. BC; and Nortel Networks Corp. (Re) — were all welcomed by the business community: Chambre des notaires enshrined the constitutional protection our courts afford to solicitor-client privilege; Endean will allow judges and parties much greater flexibility in dealing with national class actions, something that should decidedly impact their efficiency and cost; and Nortel provides a procedural and technological framework for the management of multi-jurisdictional insolvencies.

From that point on, however, it’s downhill for business: only McGillivray Restaurant v. Canada, which provides a higher level of certainty and comfort to taxpayers and advisors seeking guidance on the important and pervasive issue of “de facto control” over a corporation for tax purposes, can be regarded as pro-business among the remaining five cases. For its part, Keough v. Sandfire Capital produced a mixed result: although it created greater certainty for New Brunswick mortgagees in the event of default, it also broadened their potential liability.

Otherwise, Daniels v. Canada established that the rights of our country’s Métis peoples were on a par with the rights accorded to First Nations, with significant implications for the duty to consult; Wilson v. Atomic Energy of Canada confirmed that federally regulated employers can’t dismiss employees without cause; and Eastern Regional Integrated Health Authority v. Association of Registered Nurses required health-care practitioners in Newfoundland and Labrador to disclose “quality assurance” information relating to adverse incidents, a decision that could impact other Canadian provinces with similar health laws.

Six of our 10 judgments emanated from the Supreme Court of Canada, including five of the top six. The other four judgments came from the Federal Court of Appeal, the New Brunswick Court of Appeal, the Newfoundland and Labrador Court of Appeal, and the Ontario Court of Appeal.

From a geographical perspective, Ontario produced six decisions, Alberta generated two, and British Columbia, Manitoba, New Brunswick, Newfoundland and Labrador, Québec and Saskatchewan each produced one. The total of 14 cases arises from the fact that, as noted below in our review of the individual cases, Green was a trilogy and both Endean and Chambres des notaires involved sister cases.

Cases that came close but didn’t quite make the list included the SCC’s ruling in CBC v. SODRAC, a key decision on reproduction rights under the Copyright Act that casts further light on the principle of “technological neutrality” in intellectual property law; Alberta v. Moloney, the lead case in a trilogy characterized by the SCC’s conclusion that provincial legislation preserving liabilities for unpaid fines after bankruptcy was unconstitutional — and one that dealt a serious blow to insurers; Re Hecla Mining, in which the securities commissions of British Columbia and Alberta provided their first guidance on the circumstances in which a private placement was an inappropriate defensive tactic under the new Canadian takeover bid regime that became effective in May 2016; Midwest Properties v. Thordarson, where the OCA  gave an expansive interpretation of the statutory right of compensation for spills under the province’s Environmental Protection Act, suggesting that courts could rely on section 99 of the statute to pierce the corporate veil; Ramdath v. George Brown College, confirming Ontario courts’ authority to award aggregate damages in class actions; and U.S. Steel Canada Inc. (Re), in which the OCA appears to have closed the door on claims of equitable subordination in Companies’ Creditors Arrangement Act (CCAA) proceedings.

Also considered carefully were Howard v. Benson Group, where the OCA held that the obligation to pay dismissed fixed-term employees their full wages and benefits for the unexpired portion of their contracts was not subject to mitigation; Canada v. John Doe, in which the Federal Court of Appeal reined in the expansion of individualized privacy claims into the realm of class actions against institutions and businesses; Krayzel Corp. v. Equitable Trust, an SCC decision that held that rate increases triggered by mortgage defaults offended the Interest Act regardless of the form the increase takes, whether by way of an increase in the rate itself, fines, penalties or lump-sum bonuses, so long as the effect was to increase the interest on arrears beyond the rate payable on default; and 1250264 Ontario Inc. v. Pet Valu Canada, a case that limited the scope of franchisors’ obligations under the province’s Arthur Wishart Act to deal fairly with franchisees.

Close calls aside, here’s a review of Lexpert’s Top 10 business decisions.


No. 1
CIBC v. Green
(SCC, OCA)

Plaintiffs seeking leave to file secondary market securities class actions in Canada are now finding themselves on a road with a significantly steeper gradient than they have encountered in the past. For this, they can thank the Supreme Court of Canada’s December 2015 decisions in this trilogy of securities class action cases, all on appeal from the Ontario Court of Appeal.

While the trilogy (which also included Silver v. IMAX and Trustees v. Celestica) dealt with a number of important issues, including the limitation period under section 138.3 of Ontario’s Securities Act, the rulings on the leave issue will have the most lasting impact going forward.

Until Green was released, certitude was decidedly not a feature of the leave test for secondary-market class actions. In February 2014, the Ontario Court of Appeal stated that the statutory test, which requires “a reasonable possibility that the plaintiff will succeed at trial,” was a “relatively low threshold.”

Two months later, the SCC threw more than a little water on that fire in Theratechnologies v. 121851 Canada Inc. Dealing with the Québec equivalent of the Ontario test, the high court ruled that leave was intended to be a “meaningful screening mechanism” designed to prevent “costly strike suits with little chance of success.” Accordingly, plaintiffs had to show more than a mere possibility of success, as some courts had held; rather, the test required “a reasonable or realistic chance that the action will succeed.” The test, therefore, necessitated a preliminary assessment of the merits of the claims based on a review of the evidence as well as the law.

Theratechnologies, then, put some substance into the standard that plaintiffs must meet to satisfy the leave threshold for filing a securities class action. “The fact that there is an arguable chance of success is no longer sufficient to obtain leave,” explained Pierre Lefebvre of Fasken Martineau DuMoulin LLP at the time. Lefebvre, with colleague Philippe Charest-Beaudry in Montréal, represented the defendant Theratechnologies. “There must be a determination of whether success is a reasonable prospect — and that changes the whole dimension of the leave test.”

Doubt remained, however, as to whether or not Theratechnologies applied across Canada. “That doubt is gone,” said Andrea Laing, who with colleagues Nigel Campbell and Ryan Morris of Blake, Cassels & Graydon LLP in Toronto represented Celestica. “The Green trilogy supports a robust interpretation of the leave standard throughout Canada, including a realistic review of the evidence and meaningful legal analysis.”

Critics have argued that the Supreme Court’s interpretation of the rule could result in unnecessarily complex, costly and lengthy leave proceedings. But Alan D’Silva of Stikeman Elliott LLP in Toronto argues that a hearing with a merits component comports with the legislative intent. “When the Canadian Securities Administrators invoked the need for a leave test, they were definitely thinking of a hearing on the merits,” he says. “But that doesn’t mean each leave hearing will involve a full-out, extensive evidentiary record, because each case will be different.”

What is certainly clear is that leave hearings must now involve a weighing of whatever evidence is brought forward. Herein, however, lies an unanswered question. “The Supreme Court has spoken on the level of proof necessary for the plaintiff to meet the leave test but has not at all addressed the level of proof necessary for a defendant raising a defence to the plaintiff’s allegations,” says commercial litigator John Campion in Toronto.

N
onetheless, there’s little doubt that litigation strategy will change dramatically. “When courts were treating leave applications like rubber stamps, there was always a real discussion as to whether the defence should consent to leave instead of subjecting clients to invasive cross-examinations,” Laing said. “But now that the test has teeth, there’s more upside to fighting leave vigorously.”

LEGAL REPRESENTATION

CIBC v. Green
Canadian Imperial Bank of Commerce: Torys LLP (Sheila Block, James Tory)
Gerald McCaughey et al.: Goodmans LLP (Benjamin Zarnett, David Conklin)
Howard Green, Anne Bell: Rochon Genova LLP (Peter Jervis, Joel Rochon, Sakie Tambakos, Remissa Hirji)
Canadian Foundation for Advancement of Investor Rights: Paliare Roland Rosenberg Rothstein LLP (Margaret Waddell, Denise Cooney)
Shareholder Association for Research and Education: Groia & Co. PC (Bonnie Roberts Jones)
Ontario Securities Commission: Anna Perschy, Amanda Heydon (in-house)
Insurance Bureau of Canada: Stikeman Elliott LLP (Alan D’Silva, Daniel Murdoch, Sinziana Hennig)

Silver v. IMAX
Marvin Silver, Cliff Cohen: Siskinds LLP (Dimitri Lascaris, Michael Robb, Daniel Bach, Serge Kalloghlian); Sutts, Strosberg LLP (William Sasso)
IMAX Corp. et al.: McCarthy Tétrault LLP (Paul Steep, Dana Peebles, Brandon Kain)
Canadian Foundation for Advancement of Investor Rights: Paliare Roland Rosenberg Rothstein LLP (Margaret Waddell, Denise Cooney)
Ontario Securities Commission: Anna Perschy and Amanda Heydon (in-house)

Trustees v. Celestica
Trustees of the Millwright Regional Council of Ontario Pension Trust Fund, Nabil Berzi, Huacheng Xing: Koskie Minsky LLP (Kirk Baert, Celeste Poltak)
Celestica Inc., Stephen Delaney, Anthony Puppi: Blake, Cassels & Graydon LLP (Nigel Campbell, Andrea Laing, Ryan Morris)
Canadian Foundation for Advancement of Investor Rights: Paliare Roland Rosenberg Rothstein LLP (Margaret Waddell, Denise Cooney)
Ontario Securities Commission: Anna Perschy and Amanda Heydon (in-house)


No. 2
Ledcor Construction v. Northbridge Indemnity Insurance (SCC, ABCA)

The SCC’s 2014 decision in Sattva v. Creston was the second case on Lexpert’s Top 10 business decisions list for that year. Rejecting the traditional view that contractual interpretation involves pure questions of law, the court ruled that the exercise engaged questions of mixed fact and law, meaning that rulings on contractual interpretation could only be successfully appealed if they met a very deferential standard of “reasonableness,” which required identification of a palpable and overriding error by the trial or motions judge.

The business community lauded the SCC’s approach, noting that it promoted certainty in commercial dealings and was in accord with both commercial reality and the way courts had been approaching contractual interpretation in recent years.

But following the decision, Mary Paterson of Osler, Hoskin & Harcourt LLP in Toronto predicted that the landmark ruling would take a while to flesh out. “It’s rare to see the court turn the common law on its head,” she said. “So many things depend on whether an issue is a question of law or of mixed fact and law, including the availability of civil appeals and reviews of arbitrators’ decisions, that it will be a while before we see the full scope of this judgment.”

As it turns out, it didn’t take that long. Just about two years later, the SCC got a chance to reconsider Sattva in the context of standard-form contracts. At issue in Ledcor was the interpretation of an exclusion clause in a standard-form construction insurance contract.

The Alberta Court of Appeal distinguished Sattva and applied a much less onerous “correctness” standard of appellate review. The SCC agreed. The court held that “reasonableness” was not the appropriate standard of review for standard-form contracts where the interpretation at issue had precedential value and lacked a meaningful factual matrix specific to the parties. When these conditions arose, the interpretation of the contract was better characterized as a question of law, subject to the correctness standard.

“The decision is important because so many commercial contracts — everything from buying a plane to dropping shoes off at a cobbler to buying construction materials to securities agreements to insurance policies — are standard-form contracts,” says Eugene Meehan of Ottawa’s Supreme Advocacy LLP, who with in-house counsel Stacy Boothman, represented Ledcor. “Who among us hasn’t filed an insurance claim or isn’t likely to do so at some point in the future? That’s how universally important this area of the law is.”

The decision, Meehan adds, significantly changes the way commercial lawyers will be looking at standard-form contracts. “When you combine the contra preferentem rule with Ledcor, it’s apparent that external lawyers and in-house counsel have to draft very clear contract clauses to avoid the higher vulnerability to which their clients are now exposed.”

LEGAL REPRESENTATION

Ledcor Construction Co. Ltd.: Stacey Boothman (in-house); Supreme Advocacy LLP (Eugene Meehan)
Northbridge Indemnity Insurance Co., Royal & Sun Alliance Insurance Co. of Canada, Chartis Insurance Co. of Canada: Owen Bird Law Corp. (Gregory Tucker, Scott Stephens)


Station Lands v. Commonwealth Insurance
Station Lands Ltd.: Dentons Canada LLP (Dennis Picco); Supreme Advocacy Group (Marie-France Major)
Commonwealth Insurance Co., GCAN Insurance Co., American Home Assurance Co.: Owen Bird Law Corp. (Gregory Tucker, Scott Stephens)


No. 3
Canada v. Chambre des notaires du Québec; Canada v. Thompson (SCC, ABCA)

The Income Tax Act recognizes solicitor-client privilege, but excludes “an accounting record of a lawyer” from that privilege. These cases, which involved Canada Revenue Agency demands for information from lawyers and notaries, challenged the constitutionality of that exclusion, and both succeeded.

According to Michael Feder, who with colleague Emily MacKinnon of McCarthy Tétrault LLP in Vancouver represented Duncan Thompson, the taxpayers not only succeeded, but succeeded in spades. “The SCC blew a hole in the ITA provisions that apply to the investigation of lawyers and notaries,” he says. “Previously, there was ambiguity in the law as to whether legislators could deem something to be not privileged, but this case makes it clear that solicitor-client privilege can’t just be legislated away — that it’s not just a presumption that applies to lawyers and notaries but a true constitutional principle.”

Chambre de notaires reaffirms the uniqueness of Canada’s jurisprudential position on solicitor-client privilege. “Other jurisdictions are not going in this direction,” Feder says. “The rulings put Canada out on an island so far as the rest of the Commonwealth is concerned, and US lawyers can’t believe it.”

The fallout, Feder believes, will be significant. “There are a lot of administrative practices throughout Canada that are not fully cognizant and respectful of the constitutional status that solicitor-client privilege now clearly enjoys,” he says.

LEGAL REPRESENTATION

Canada v. Chambre des notaires du Québec
Attorney General of Canada, Canada Revenue Agency: Justice Canada (Marc Ribeiro, Christopher Rupar, Chantal Comtois)
Chambre des notaires du Québec: Lavery, de Billy, L.L.P. (Raymond Doray, Loïc Berdnikoff)
Barreau du Québec: Shadley Battista Costom, s.e.n.c. (Giuseppe Battista)
Advocates’ Society: Norton Rose Fulbright Canada LLP (Pierre Bienvenu, Andres Garin)
Canadian Bar Association: Osler, Hoskin & Harcourt LLP (Mahmud Jamal, Alexandre Fallon, David Rankin)
Federation of Law Societies of Canada: Torys LLP (John Laskin, Yael Bienenstock)
Criminal Lawyers’ Association: Stockwoods LLP (Brian Gover, Justin Safayeni, Carlo Di Carlo)

Canada v. Thompson
Minister of National Revenue: Justice Canada (Christopher Rupar, Daniel Bourgeois)
Duncan Thompson: McCarthy Tétrault LLP (Michael Feder, Emily MacKinnon)
Federation of Law Societies of Canada: Torys LLP (John Laskin, Yael Bienenstock)
Canadian Bar Association: Osler, Hoskin & Harcourt LLP (Mahmud Jamal, Pooja Mihailovich, David Rankin)
Criminal Lawyers’ Association: Stockwoods LLP (Michal Fairburn, Carlo Di Carlo)


No. 4
Endean v. BC
; Parsons v. Ontario (SCC, OCA)

Many observers believe that these twin decisions, in which the SCC ruled that superior court judges in Ontario and British Columbia can conduct certain hearings outside of their home province, will facilitate the management of multijurisdictional class actions. Both the BC Court of Appeal and the Ontario Court of Appeal had ruled that the open court principle necessitated a video link back to courtrooms in the judges’ home provinces. But the SCC disagreed, holding that no such link was necessary.

Still, Chris Naudie of Osler in Toronto says the rulings, which arose in the context of a complex $1.1-billion settlement of the national class action relating to the hepatitis C tainted blood scandal, will not likely result in significant changes to current practice regarding settlement hearings for national class actions. “The protocol that exists includes a video link, which isn’t much of an issue because the technology is pretty seamless these days,” he says. “So don’t expect to see roving judges with suitcases as a matter of course, both because we have a settled practice that works very well and also because judges are more inclined to convene settlement hearings in their home province.”

But the SCC’s reasoning, which founds judges’ power to sit outside their home province on broad statutory authority, suggests that the SCC has an open mind regarding courts’ discretion in the management of national class actions generally. More particularly, the SCC agreed with then Chief Justice Warren Winkler of the OCA that taking a narrow view of this discretion leaves the common law ill-equipped to deal with the “modern realities of increasingly complex litigation involving parties and subject matters that transcend provincial borders.”

It all makes sense, says Martin Sclisizzi of Borden Ladner Gervais LLP in Toronto. “This is an immense decision because the modern reality is one in which national class actions are becoming the norm,” he says. “So does it seem right for five judges to hear five identical settlement applications? Think of the cost and drain on resources, and the extent to which these decisions make the process so much more efficient.”

Just how far courts will take this liberal approach remains to be seen. It’s not clear, for example, how courts will deal with settlement approvals in which objectors want to make submissions in a local courtroom. “Judges do like to have an open courtroom to accommodate last minute objections,” Naudie says. “In these cases, a video link may be the answer.”

The SCC did emphasize that the cases before them were being decided on a paper record without oral evidence, which meant that judges would not be required to exercise coercive powers — such as the power to direct a witness to appear and to answer questions — that might be subject to territorial limits. “The decisions also leave open questions about whether the power to sit outside of a home jurisdiction extends to joint hearings involving oral evidence, joint hearings in a cross-border class proceeding, or to cases that are not class actions,” Naudie says.

LEGAL REPRESENTATION

Endean v. British Columbia
Anita Endean, as representative plaintiff: Camp Fiorante Matthews Mogerman LLP (Sharon Matthews, J.J. Camp); Michael Sobkin
The Province of British Columbia: British Columbia Ministry of Justice and Attorney General (Keith Evans, Katherine Webber)
Attorney General of Canada: Justice Canada (Robert Frater, Kathryn Hucal)


Parsons v. Ontario
Dianna Parsons: Pape Barristers PC (Paul Pape, Shantona Chaudhury)
Fund Counsel for Ontario: Gowling WLG (John Callaghan, Alex Zavaglia)
The Province of Ontario: Ontario Ministry of the Attorney General (Josh Hunter, Brent Kettles, Lynne McArdle)
The Province of Alberta et al.: McCarthy Tétrault LLP (Caroline Zayid, Michael Rosenberg, Adam Goldenberg)
Attorney General of Québec: Ministère de la justice du Québec (Dana Pescarus, Carole Soucy, Manon Des Ormeaux)


No. 5
Nortel Networks Corp. (Re) (OCA)

This decision of the Ontario Court of Appeal, denying leave to appeal, emanates from the cross-border insolvency proceedings relating to Nortel Networks Corp. The denial of leave was undoubtedly a major catalyst to the global settlement that followed, ending more than eight years of legal manoeuvring at unprecedented expense.

The Ontario Court of Appeal, which rarely issues reasons when leave to appeal is denied, saw fit to issue 42 pages of reasons in this case. The court upheld the decision of the Canadian trial judge for the joint Canada-US trial and cited the reasons of the US judge involved. It represents the first appellate confirmation anywhere of an allocation of global sale proceeds based on pro rata principles.

Quite apart from the substantive aspects of the case, however, its procedural implications are at least as significant. Former Ontario Chief Justice Warren Winkler described the proceedings as “one of the most complex trans-national legal proceedings in history” that lacked “any realistic ‘litigation’ option to resolve the dispute.” The case, which involved more than 40 Nortel-related companies around the world, proceeded under the supervision of Canada and US bankruptcy courts. Creditors in over 20 countries made claims.

Although cross-border protocols for dealing with insolvency issues have existed for some time, and have worked fairly well, Nortel’s complexity made them little more than a foundation on which to create a process. “This is the first case where we opened the door completely under the protocols, and we had to, because we lacked a procedural and technological framework for what was ultimately involved,” says D.J. Miller, who with colleague John Finnigan of Thornton Grout Finnigan LLP in Toronto represented the creditors from the United Kingdom. “It became a test case to evaluate whether we could do a cross-border trial that was ‘joint’ in every respect.”

The fact that the case went to appellate courts in Canada and the United States, whose individual decision had an impact on the other, was also truly precedential. “There was no jurisdictional basis or formal mechanism for the appellate courts to talk to one another, but it happened,” Miller says. “It demonstrated that appellate courts are going to be as open to issuing bold decisions and having another appellate court take that decision and have it impact in their own jurisdiction.”

With cross-border insolvency becoming more and more complex, many predicted they would ultimately become unmanageable. “What the courts demonstrated in Nortel is that these cases will not be a mug’s game and that principles of comity really do matter,” Miller says. “That’s going to be very important in maintaining some sense of efficiency for businesses involved in this kind of litigation — and I suspect it will spill out into other kinds of commercial disputes.”

LEGAL REPRESENTATION

US Debtors: Torys LLP (Sheila Block, Scott Bomhof, Andrew Gray, Adam Slavens, Jeremy Opolsky)
Ad Hoc Group of Bondholders: Bennett Jones LLP (Richard Swan, Richard Orzy, Gavin Finlayson)
Conflicts Administrator of Nortel Networks SA: Stikeman Elliott LLP (David Byers, Daniel Murdoch)
Official Committee of Unsecured Creditors of Nortel Networks Inc., et al.: Cassels Brock & Blackwell LLP (Shayne Kukulowicz, Michael Wunder, Ryan Jacobs, Geoffrey Shaw, Jane Dietrich)
The Bank of New York Mellon as Indenture Trustee: McMillan LLP (Andrew Kent, Brett Harrison, Laura Brazil)
Nortel Trade Claims Consortium: Aird & Berlis LLP (Steven Graff, Ian Aversa, Miranda Spence)
Board of the Pension Protection Fund and Nortel Networks U.K. Pension Trust Ltd.: Blake, Cassels & Graydon LLP (Michael Barrack); Thornton Grout Finnigan LLP (D.J. Miller, John Finnigan, Andrea McEwan); Osler, Hoskin & Harcourt LLP (Michael Shakra)
Ernst & Young Inc.: Goodmans LLP (Benjamin Zarnett, Jessica Kimmel, Peter Ruby, Peter Kolla)
Wilmington Trust, National Association: Dentons Canada LLP (Kenneth Kraft, John Salmas)
Canadian Debtors: Gowling WLG (Derrick Tay, Jennifer Stam)
Superintendent of Financial Services as Administrator of the Pension Benefits Guarantee Fund: Paliare Roland Rosenberg Rothstein LLP (Kenneth Rosenberg, Lily Harmer, Massimo Starnino)
Former Employees of Nortel and LTD Beneficiaries: Koskie Minsky LLP (Mark Zigler); Kaplan Law (Ari Kaplan)
Canadian Creditors’ Committee: Shibley Righton LLP (Arthur Jacques); McCarthy Tétrault LLP (Paul Steep, Byron Shaw)
CAW-Canada: Unifor (Barry Wadsworth)
Joint Administrators of the EMEA Debtors other than Nortel Networks S.A.: Davies Ward Phillips & Vineberg LLP (Matthew Gottlieb, Matthew Milne-Smith)


No. 6
Daniels v. Canada (SCC, SKCA)

Daniels decided that the federal government has legislative authority over Métis peoples, resolving a longstanding constitutional dispute. While the Court refused to declare that the “duty to consult” applied to Métis, it did so because, in its view, that duty had already been established.

“The case doesn’t fundamentally alter underlying duties, but it does underline that the SCC and other courts are putting more meat on the bones of Métis rights,” says Maxime Faille of Gowling WLG in Vancouver, who with partner Paul Seaman represented the Gift Lake Métis Association. “What the Supreme Court is saying is that Métis rights must be treated with the same consideration as First Nations’ rights. That’s quite significant in terms of the responsibility of project proponents to interface with Métis.”

The federal government has taken notice. In May 2016, less than two months after the Daniels judgment, it signed a Memorandum of Understanding on Reconciliation with the Manitoba Métis Federation that set out a “mutually agreeable path on finding a shared solution in implementing” Daniels. Carolyn Bennett, Minister of Indigenous and Northern Affairs, followed up in July by releasing a report on the development of Métis rights authored by Thomas Isaac of Cassels Brock & Blackwell LLP in Vancouver.

LEGAL REPRESENTATION

Harry Daniels, Gabriel Daniels, Leah Gardner, Terry Joudrey, Congress of Aboriginal Peoples: University of Ottawa Faculty of Law (Joseph Magnet); Paliare Roland Rosenberg Rothstein LLP (Andrew Lokan, Lindsay Scott)
Minister of Indian Affairs and Northern Development and Attorney General of Canada: Justice Canada (Mark Kindrachuk, Christopher Rupar, Shauna Bedingfield)
Attorney General for Saskatchewan: Saskatchewan Ministry of Justice and Attorney General (Mitch McAdam)
Attorney General for Alberta: Alberta Department of Justice and Solicitor General (Angela Edgington, Neil Dobson)
Native Council of Nova Scotia, New Brunswick Aboriginal People’s Council, Native Council of Prince Edward Island: Burchells LLP (Bruce Clarke)
Métis Settlements General Council: Witten LLP (Gary Appelt, Keltie Lambert)
Te’mexw Treaty Association: JFK Law Corp. (Robert Janes); Mandell Pinder LLP (Elin Sigurdson)
Métis Federation of Canada: DGW Law Corp. (Christopher Devlin, John Gailus, Cynthia Westaway)
Aseniwuche Winewak Nation of Canada: JFK Law corp. (Karey Brooks, Claire Truesdale)
Chiefs of Ontario: Nahwegahbow Corbiere Genoodmagejig Barristers & Solicitors (Scott Robertson)
Gift Lake Métis Settlement: Gowling WLG (Paul Seaman, Maxime Faille)
Native Alliance of Quebec: Gagné Letarte SENCRL (Marc Watters, Lina Beaulieu)
Assembly of First Nations: Gowling WLG (Guy Régimbald, Jaimie Lickers)
Métis National Council: Clément Chartier (in-house); Pape Salter Teillet LLP (Jason Madden); Hodgson-Smith Law (Kathy Hodgson-Smith); BoyneClarke LLP (Marc LeClair)


No. 7
McGillivray Restaurant v. Canada (Federal Court, MBCA)

The Canadian tax community and its clients have long awaited a clear legal test for determining whether a person has “de facto control” over a corporation for tax purposes. “Business people feared the issue because there was no red line in the jurisprudence,” says William Innes of Rueters LLP in Toronto.

McGillivray should allay these fears. “The FCA’s clarification in McGillivray should have the practical effect of providing a higher level of certainty and comfort to taxpayers seeking advice on this important and pervasive issue in a variety of circumstances,” writes Matthew Peters in a Bennett Jones LLP newsletter.

The case confirms a much narrower and more practical test than existed previously in deciding whether de facto control existed. “In this respect, the only relevant factors are those founded on a legally enforceable right and ability to effect a change to the board of directors or its powers, or to exercise influence over the shareholder or shareholders who have that right and ability,” Peters writes.

“In other words, factual operational control is irrelevant in the absence of a right to undertake actions that are otherwise within the exclusive purview of the shareholders who have legal (de jure) control [of] the board.”

LEGAL REPRESENTATION

McGillivray Restaurant Ltd.: Aikins, MacAulay & Thorvaldson LLP (Thor Hansell)
The Government of Canada: Justice Canada (Julien Bédard, Neil Goodridge)


No. 8
Wilson v. Atomic Energy of Canada (SCC, OCA)

For years, judges have confirmed that federally regulated employers cannot terminate employees without just cause. In other words, the common-law rule that non-unionized employees can be dismissed without cause, if reasonable notice or pay in lieu of notice is provided, did not apply in the federal landscape.

In Wilson, however, the Federal Court of Appeal shocked employers and employees by ruling that a proper reading of the Canada Labour Code did allow dismissal without just cause. The employee appealed, and Wilson became the first time the SCC had confronted the subject.

The high court overruled the FCA and upheld the mainstream view. “Had the decision gone the other way, it would have undone decades of case law,” says Steven Barrett, who with colleague Louis Century of Goldblatt Partners LLP in Toronto represented the Canadian Labour Congress. “What it did, however, was set the world back to the normal place in which most people thought it was.”

The upshot is that employees dismissed without just cause may complain under section 240 of the Canadian Labour Code, and seek reinstatement, with or without back pay or damages, or compensation with pay in lieu of reinstatement plus damages.

LEGAL REPRESENTATION

Joseph Wilson: LeNoury Law (James LeNoury); Avi Sirlin; Reagan Ruslim
Atomic Energy of Canada Ltd.: Fogler, Rubinoff LLP (Ronald Snyder, Eugene Derényi)
Canadian Labour Congress: Goldblatt Partners LLP (Steven Barrett, Louis Century)
Canadian Association for Non-Organized Employees: Ball PC (Stacey Ball); Frauts Dobbie (Anne Marie Frauts)
Federally Regulated Employers – Transportation and Communications and the Canadian Association of Counsel to Employers: Fasken Martineau DuMoulin LLP (Christopher Pigott, Christina Hall)



No. 9
Eastern Regional Integrated Health Authority v. Association of Registered Nurses (NLCA)

Like Newfoundland, many Canadian jurisdictions have laws that give regulatory bodies and professional associations statutory powers to demand evidence when conducting investigations. But most of them also share the prohibition that Newfoundland’s Evidence Act features regarding the release of quality-assurance information compiled pursuant to an adverse incident review.

“These reviews often involve peer reviews by doctors and nurses along with the sharing of other sensitive information — all with the goal of improving the delivery of health services in the future,” writes Trent Skanes of McInnes Cooper in St. John’s, who represented the Eastern Regional Integrated Health Authority, in a firm bulletin. “But there’s been uncertainty around healthcare authorities protecting this information and sharing it.”

As the Newfoundland Court of Appeal saw it, the Health Authority’s powers under the Public Inquiries Act overrode the prohibition in the Evidence Act. “The decision signals an underlying policy decision favouring disclosure of information relating to adverse incidents in the right circumstances over shielding such information, and sheds some light on courts’ preferred approach,” Skanes writes.

Skanes recommends health-care stakeholders throughout the country, where the topic remains controversial, evaluate the decision carefully. “Although the decision is primarily grounded in the specific statutory provisions in the Newfoundland & Labrador Public Inquiries Act and Evidence Act, it may impact a number of provinces and territories with similar laws granting similar investigatory powers, and similar prohibitions or privileges designed to protect quality assurance information.”

LEGAL REPRESENTATION

Eastern Regional Integrated Health Authority: A.F. Bruce Law (Augustine Bruce)
Association of Registered Nurses of Newfoundland and Labrador: Trudy Button (in-house); McInnes Cooper (Trent Skanes)
Darrell Boone: Curtis, Dawe Lawyers (Peter Browne, Aimee Rowe)
Newfoundland and Labrador Association of Social Workers: O'Dea Earle Injury Lawyers (Thomas Williams)


No. 10
Keough v. Sandfire Capital (NBCA)

New Brunswick’s mortgagors and mortgagees have long been frustrated by conflicting jurisprudence over lender’s rights to recover post-mortgage sale expenses. “Keough provides welcome clarity not only on the subject of whether a lender is entitled to recover post-mortgage sale expenses in a deficiency action but also on how courts should calculate lenders’ damages in such cases,” says Romain Viel of McInnes Cooper in Fredericton.

Viel says that four principles emerge from the decision: (1) a lender may be subject to a claim for damages if it exercises its power of sale improperly, but the duty doesn’t apply when lenders exercise their right to buy-in or resell, in which cases they benefit from the unrestricted immunity given by the statutory regime; (2) purchasing a property for a nominal amount at a mortgage sale is an improper exercise of the power of sale; (3) if the lender acts improperly, the deficiency will be the unpaid mortgage balance less the property’s market value at the date of the sale; (4) a lender who purchases a property at a mortgage sale owns the property for its own benefit and use and can sell it as it sees fit.

“The decision will definitely affect mortgage sale strategies and resale processes,” Viel says. “But it’s also the first time that mortgagors have potential claims against mortgagees who exercise powers of sale.”

LEGAL REPRESENTATION

Gregory Keough: Stewart McKelvey (Josie Marks)
Sandfire Capital LP: Fowler & Fowler (James Fowler)

Lawyer(s):

Firm(s):

Practice Area(s):