Sep 21, 2020

COURT OF APPEAL SUMMARIES (September 7 – September 18, 2020)

Perlmutter v. Smith, 2020 ONCA 570 (CanLII)

[Lauwers, Brown and Nordheimer JJ.A.]

Counsel:

J. Goldblatt, J. Katz, for the appellant

J. Morse and D. Trafford, for the respondent H.P.

W. Fogarty and P. Masic, for the respondents I.P. and L.P.

Keywords: Conflict of Laws, Civil Procedure, Letters of Request, Evidence Act, R.S.O. 1990, c. E.23, s. 60, Canada Evidence Act, R.S.C. 1985, c. C-5, s. 46, Rules of Civil Procedure, Rule 25.11(b), Gulf Oil Corporation v Gulf Canada Ltd et al, [1980] 2 SCR 39, R v Zingre, [1981] 2 SCR 392, Presbyterian Church of Sudan v Taylor, (2006), 275 DLR (4th) 512 (Ont CA), Lantheus Medical Imaging Inc v Atomic Energy of Canada Ltd, 2013 ONCA 264, Re Friction Division Products, Inc and E.I. Du Pont de Nemours & Co Inc et al (No 2) (1986), 56 OR (2d) 722 (HC), Fecht v Deloitte & Touche (1996), 28 OR (3d) 188 (Gen Div), Treat America Ltd v Nestlé Canada Inc, 2011 ONCA 560, Presbyterian Church of Sudan v Talisman Energy Inc, 2005 ABQB 920, AstraZeneca LP v Wolman, 2009 CarswellOnt 7787 (SC), Pecarsky v Lipton Wiseman Altbaum & Partners, [1999] OJ No 2004 (SC), Aker Biomarine AS v KGK Synergize Inc, 2013 ONSC 4897, Ontario Public Service Employees Union Pension Fund (Trustees of) v Clark (2006), 270 DLR (4th) 429 (Ont CA), France (Republic) v De Havilland Aircraft of Canada Ltd (1991), 3 OR (3d) 705 (CA), Johnson v Marzouca, 2016 ONCA 298, Oticon v Gennum Corp, 2010 ONSC 1638, Scoular Co v Detlefsen, 2016 ONSC 4001

FACTS:

The respondents both owned a home in a “private” community in Florida. Following a disagreement, the respondent, H.P., received hate letters falsely accusing him of crimes. These letters were also sent to the respondent’s family, friends and clients (the “hate mail campaign”). The respondent, H.P., believed the respondents I.P. and L.P. were orchestrating the hate mail campaign and he commenced an action against them in the Florida Courts.

After discovering that the appellant, an Ontario resident, was also involved in the hate mail campaign, the respondents filed a joint motion in the Florida Court for a letter of request seeking the Superior Court of Ontario’s assistance in obtaining evidence from the appellant. The Florida Court issued an initial Request for International Assistance; however, the appellant did not comply. The respondents then commenced an application in the Ontario Superior Court of Justice (“Ont. SCJ”) in February 2018 to enforce the Initial Letter of Request.

In August 2018, the respondents returned to the Florida Court which granted two Letters of Request: one in favour of the respondents I.P. and L.P. and the other in favour of both of the respondents (the “Second Letters of Request”). The judge heard the two applications to enforce the Second Letters of Request.

The application judge made an order giving effect to the Letters of Request addressed to the Ontario Superior Court of Justice from a Florida Court. The Order of the judge did three things: (i) it gave effect to the Second Letters of Request; (ii) it provided some directions regarding the implementation of the Second Letters of Request, including the scope of documentary production; and (iii) it set out the procedure for the disposition and review of electronic devices belonging to the appellant that are in the possession of the Toronto Police Service. The appellant sought to appeal the Order.

ISSUES:

(1) Did the application judge err by:
a) concluding that the appellant’s evidence was not otherwise obtainable?
b) finding that the Second Letters of Request did not impose an undue burden on the appellant?
c) holding that the documents sought were identified with reasonable specificity?
d) failing to go behind the Second Letters of Request to identify defects in the process before the Florida Court that led to their issuance?

(2) Should leave to appeal the Costs Order be granted?

HOLDING:

Appeal dismissed. Motion for leave to appeal the Costs Order denied.

REASONING:

General Principle

At the outset, the Court recognized the governing principles applicable when an Ontario Court considers a request for assistance from a foreign tribunal. The principle to be applied in considering a request for assistance is recognition of the comity of nations: that one sovereign nation voluntarily adopts or enforces the laws of another out of deference, mutuality, and respect. As a result, a foreign request is to be given full force and effect unless it is contrary to the public policy or otherwise prejudicial to the sovereignty of the jurisdiction to which the request is directed. The Court has held that orders originating from the United States should be given full faith and credit unless to do so would be contrary to the interests of justice or infringe on Canadian sovereignty.

To balance the need for comity against the possible infringement of Canadian sovereignty the application judge was required to consider the following factors:

(1) Whether the evidence sought was relevant;
(2) Whether the evidence sought was necessary for trial and would be adduced at trial, if admissible;
(3) Whether the evidence was not otherwise obtainable;
(4) Whether the order sought was contrary to public policy;
(5) Whether the documents sought were identified with reasonable specificity;
(6) Whether the order sought was not unduly burdensome, having in mind what the relevant witnesses would be required to do, and produce, were the action to be tried in Ontario.

The decision to grant or refuse a foreign request is a matter of judicial discretion, to which deference must be given in the absence of a demonstrated error in principle by the Court below.

(1) a) Did the application judge err in concluding that the appellant’s evidence was not otherwise obtainable?

No. The appellant argued that the judge failed to consider that the appellant’s evidence had become compellable by the respondents when his appeal in the Florida Action had been turned down. The Court found that the application judge did consider the effect of the dismissal of the appellant’s Florida appeal, but that the application judge discounted the significance of that dismissal. The Court found no palpable or overriding error in the application judge’s finding that the appellant was “loath” to appear in the United States to give a deposition and that, by his actions, had made it clear that he was unwilling to respond to the procedures of the Florida Court. Furthermore, the “fresh evidence” brought to the Court shed no definitive light on whether the appellant would appear for deposition in the Florida proceedings; nor had the appellant filed any evidence to explain how a Florida Court could compel an Ontario resident to give evidence in a Florida action.

The appellant also argued that many of the documents sought were “otherwise obtainable” by other measures. The application judge reasoned that hate mail and conspiracy are not generally made accessible by those involved. The judge held that the nature of the Letters of Request made clear the intention of the Florida Court to shed light on the full breadth of the allegations. The judge found that a failure to enforce them on the basis that any of this information was otherwise available would undermine that purpose. The Court found no error in the judge’s finding that the information sought through these Letters of Request was not otherwise obtainable.

(1) b) Did the application judge err in concluding that the Second Letters of Request did not impose an undue burden on the appellant?

No. Since his jurisdictional appeal had been dismissed, the appellant argued that he must now submit to two rounds of pre-trial discovery through two different procedures: first as a party in the Florida proceedings; then, pursuant to the Second Letters of Request. The Court saw no merit in this submission. The Court agreed with the judge that the appellant’s evidence in respect of the issues in the Florida Main Action was “not otherwise obtainable” because his actions, motions and appeals made it clear that he was unwilling to respond to the procedures of the Florida Court.

(1) c) Did the application judge err in concluding that the Second Letters of Request identified the documents with reasonable specificity?

No. The appellant argued that the Second Letters of Request were overbroad because they lacked any temporal limitation and required the production of irrelevant documents. The Court agreed with the judge’s findings that the evidence being sought was limited to documents relevant to the allegations concerning the hate-mail campaign as set out in the pleadings for the Florida Action.

The appellant also argued that the revisions the application judge made to the scope of documentary production exceeded the scope of his power to give directions. The Court disagreed and found the application judge’s exercise of discretion was reasonable in the circumstances.

(1) d) Did the application judge err by failing to decline recognition of the Second Letters of Request because of defects in the Florida Court’s process?

No. The appellant contended that the Second Letters of Request were issued as a result of a flawed process in the Florida Court; and that the application judge erred by not examining the Florida Court’s process. The Court found no merit in this ground of appeal. The Court applied the principle that an Ontario Court should give full faith and credit to the orders and judgments of a U.S. Court unless it is of the view that to do so would be contrary to the interests of justice or would infringe Canadian sovereignty. The application judge examined the process used by the Florida Court and considered the appellant’s complaint. However, the judge’s reasons clearly disclose that he was not persuaded that the process tainted the Second Letters of Request such that it would be contrary to the interests of justice to enforce them. The Court agreed, stating that comity requires that flexible rules be applied to such procedural differences. A Canadian Court must balance any possible infringement of Canadian sovereignty with the natural desire to assist foreign Courts.

(2) Should Leave to Appeal the Costs Order be Granted?

No. The application judge ordered that each party was required to bear its own costs. The appellant contended that the application judge tethered the costs determination to the outcome of the Florida proceedings, effectively awarding “costs in the cause” for a proceeding that was not before him. The appellant also argued that the judge erred by departing from the general principle that non-party respondents to applications to enforce letters of request are entitled to receive their costs on an elevated scale regardless of the outcome of the enforcement application. The Court did not find that the application judge tethered the Costs Order to the outcome of the Florida proceedings. Rather, the judge explained why the conduct of each party made it difficult for him to determine who was entitled to costs. Additionally, the jurisprudence did not establish any bright line rule regarding the award of costs on successful applications to enforce letters of request. Consequently, the application judge did not err in principle in awarding no costs, nor was his Costs Order wrong.

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