The most interesting and notable decision this week was Justice Thorburn’s decision in Wright v. Horizons ETFS Management (Canada) Inc. Like Darmar Farms, which was featured in our Top Appeals of 2019 CLE (and is awaiting to hear if leave to the Supreme Court will be granted), it would appear that the Court has once again expanded the scope of negligence claims for pure economic loss that can be brought.
In this class action, the plaintiff sued the fund manager of an ETF that tracked the VIX volatility index. On a single day in February 2018, the ETF lost 90% of its value and investors were wiped out. The fund manager subsequently wound up the ETF as non-viable. The allegation made was that such an ETF, by its very design, was doomed to catastrophically fail, and that the fund manager was therefore negligent in designing such a fund and in the disclosure made to investors.
The certification judge, Perell J, dismissed the entire action as disclosing no reasonable cause of action. The Court set aside that decision. While it agreed with the certification judge that the claim did not fit within the shoddy goods exception to claims for pure economic loss (since the financial product in this case was not a physical danger to person or property), it held that the negligence claim in this case fell within the negligent performance of a service exception. In the alternative, the Court determined that if the claim was novel and did not fit within one of the five recognized exceptions to the bar against claims for pure economic loss, it should be allowed to proceed and be determined on a full evidentiary record.
Other topics covered this week included the apportionment of liability in a social host MVA case where the amount of insurance available was not enough to satisfy the judgment obtained, the test for being awarded advance costs under s. 124 of the CBCA to defend a D&O claim, relief from forfeiture from the failure to properly exercise an option to renew a commercial lease, solicitor and client (claim on account for services rendered), striking pleadings on the basis of no reasonable cause of action, a multiplicity of proceedings, abuse of process and issue estoppel, dismissal for delay and rights of first refusal.
Table of Contents
Civil Decisions
Tuffnail v. Meekes, 2020 ONCA 340
Keywords: Torts, Negligence, MVA, Social Host Liability, Apportionment of Fault, Automobile Insurance, Coverage, Under-Insured Motorist, Subrogation, Damages, Recovery, Apportionment, Civil Procedure, Pre-judgment Interest, Amending Pleadings, Limitation Periods, Insurance Act, RSO 1990, c I8, s 278(2), Ontario Policy Change Form 44R – Family Protection Coverage endorsement, s. 7, Courts of Justice Act, RSO 1990, c C43, s 130, Freudmann-Cohen v. Tran (2004), 70 O.R. (3d) 667 (C.A.), Endean v. St. Joseph Hospital, 2019 ONCA 181
Wright v. Horizons ETFS Management (Canada) Inc., 2020 ONCA 337
Keywords: Securities, Prospectuses, Material Misrepresentation, Secondary Market Misrepresentation, Torts, Negligence, Duty of Care, Damages, Pure Economic Loss, Civil Procedure, Class Proceedings, Certification, Striking Pleadings, No Reasonable Cause of Action, Securities Act, R.S.O. 1990, c. S.5, ss. 116, 130, 138.3, Class Proceedings Act, 1992, S.O. 1992, c. 6, s. 5(1)(a), Deloitte & Touche v. Livent Inc. (Receiver of), 2017 SCC 63, [2017] 2 S.C.R. 855, Darmar Farms Inc. v. Syngenta Canada Inc., 2019 ONCA 789, leave to appeal to S.C.C. requested, 38915, Arora v. Whirlpool Canada LP, 2013 ONCA 657, leave to appeal refused, [2013] S.C.C.A. No. 498, Lavender v. Miller Bernstein LLP, 2018 ONCA 729, leave to appeal refused, [2018] S.C.C.A. No. 488, Martel Building Ltd. v. Canada, 2000 SCC 60, Mandeville v. The Manufacturers Life Insurance Company, 2014 ONCA 417, leave to appeal refused, [2014] S.C.C.A. No. 390, Childs v. Desormeaux, 2006 SCC 18, Cooper v. Hobart, 2001 SCC 79, Canadian National Railway Co. v. Norsk Pacific Steamship Co., [1992] 1 S.C.R. 1021, Whittingham v. Crease & Co. (1978), 88 D.L.R. (3d) 353, at p. 373 (B.C.S.C.), Cannon v. Funds for Canada Foundation, 2012 ONSC 399, leave to appeal refused, 2012 ONSC 6101 (Div. Ct.), Pacific Coast Coin Exchange v. Ontario Securities Commission, [1978] 2 S.C.R. 112, Growthworks WV Management Ltd. v. Growthworks Canadian Fund Ltd., 2018 ONSC 3108, Pro‑Sys Consultants Ltd. v. Microsoft Corporation, 2013 SCC 57, Hodge v. Neinstein, 2017 ONCA 494, leave to appeal refused, [2017] S.C.C.A. No. 341
Lee v. Lalu Canada Inc., 2020 ONCA 344
Keywords: Corporations, Directors and Officers, Liability, Defence Costs, Advance Funding, Contracts, Interpretation, Unanimous Shareholder Agreements, Canada Business Corporations Act, R.S.C. 1985, c. C-44, s. 124, Cytrynbaum v. Look Communications Inc., 2013 ONCA 455, leave to appeal refused, [2013] S.C.C.A. No. 377, 379, Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53,
Burns v. RBC Life Insurance Company, 2020 ONCA 347
Keywords: Employment Law, Liability of Employees, Breach of Contract, Breach of Duty of Good Faith, Insurance, Long-Term Disability Benefits, Torts, Negligence, Negligent Misrepresentation, Civil Procedure, Striking Pleadings, No Reasonable Cause of Action
2324702 Ontario Inc. v. 1305 Dundas W Inc., 2020 ONCA 353
Keywords: Contracts, Real Property, Commercial Leases, Options to Renew, Relief from Forfeiture, Waiver, Estoppel, Commercial Tenancies Act, R.S.O. 1990, c. L.7, ss. 19, 20, Saskatchewan River Bungalows Ltd. v. Maritime Life Assurance Co., [1994] 2 S.C.R. 490, Ross v. T. Eaton Co. (1992), 11 O.R. (3d) 115 (C.A.), 1383421 Ontario Inc. v. Ole Miss Place Inc. (2003), 67 O.R. (3d) 161 (C.A.), Mapleview-Veterans Drive Investments Inc. v. Papa Kerollus VI Inc., 2016 ONCA 93
Birdseye Security Inc. v. Milosevic, 2020 ONCA 355
Keywords: Civil Procedure, Striking Pleadings, Frivolous, Vexatious, Abuse of Process, Other Proceeding Pending, Appeals, Jurisdiction, Final or Interlocutory, Rules of Civil Procedure, Rules 21.01(1)(b), 21.01(3)(c), 21.01(3)(d) and 25.11, Farris v. Staubach Ontario Inc. (2004), 32 C.C.E.L. (3d) 265 (Ont. S.C.)
Couper v. Rueter Scargall Bennett LLP , 2020 ONCA 352
Keywords: Contracts, Solicitor-Client, Contingency Fee Agreements, Accounts for Services Rendered, Civil Procedure, Reasonable Apprehension of Bias, Contingency Fee Agreements, O. Reg 195/04 to the Solicitors Act, R.S.O. 1990, c. S. 15, Watt v. Beallor Beallor Burns Inc., 2004 CanLII 19821 (Ont. C.A.)
Short Civil Decisions
Kazen v. Whitten & Lublin Professional Corporation , 2020 ONCA 325
Keywords: Torts, Professional Negligence, Lawyers, Breach of Confidence, Solicitor Client Privilege, Waiver, Civil Procedure, Striking Pleadings, Issue Estoppel, Angle v. Minister of National Revenue, [1975] 2 S.C.R. 248
Home Town Financial (Timmins) Corporation v. Levesque , 2020 ONCA 349
Keywords: Civil Procedure, Dismissal for Delay, Rules of Civil Procedure, Rule 48.14(7), Faris v. Eftimovski, 2013 ONCA 360, Kara v. Arnold, 2014 ONCA 871
Taylor v. 864773 Ontario Inc., 2020 ONCA 345
Keywords: Contracts, Interpretation, Real Property, Rights of First Refusal
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