Top 5 Civil Appeals from the Court of Appeal
4. Best v. Ranking, 2016 ONCA 492 (Blair, Pardu and Brown JJ.A.), June 21, 2016 1. Paton Estate v. Ontario Lottery and Gaming Corporation (Fallsview Casino Resort and OLG Casino Brantford), 2016 ONCA 458 (Hoy A.C.J.O., Pardu and Roberts JJ.A.), June 10, 2016 The appellants are two estates that were defrauded by a gambling addict. Shellee Spinks, a law clerk, stole over four million dollars from the appellants and others by forging documents, selling estate assets and taking the proceeds for herself. She spent the majority of the funds at an Ontario casino. Hoping to recover some of their losses, the appellants sued the Ontario Lottery and Gaming Corporation ("OLGC"), alleging knowing receipt of trust funds, unjust enrichment and negligence. Their statement of claim was struck by the motion judge, who held that it was plain and obvious that the action could not succeed. The appellants appealed from that dismissal, arguing that the motion judge erred in striking the claim at the pleadings stage. A majority of the Court of Appeal agreed, holding that while the action was by no means certain to succeed, it was also not certain to fail. As the Supreme Court explained in R. v. Imperial Tobacco Canada Ltd., 2011 SCC 42, the purpose of a motion to strike is to eliminate hopeless claims. The court must ask whether it is plain and obvious that the claim has no reasonable prospect of success. It must take the facts pleaded in the statement as claim as true, unless they are “patently ridiculous or manifestly incapable of being proven,” and the approach to this inquiry must be generous. In Citadel General Assurance Co. v. Lloyds Bank Canada, [1997] 3 S.C.R. 805, the Supreme Court outlined the principle underlying the cause of action of the knowing receipt of trust funds: a stranger to a trust may be liable where it receives trust property for its own benefit, and has knowledge of facts which would put a reasonable person on inquiry, but fails to inquire as to the possible misapplication of the property. Pardu J.A. held that she was not convinced that the appellants’ claim for knowing receipt could not possibly succeed. If a trier of fact were to conclude that OLGC had good reason to suspect that the money gambled by Spinks might have been stolen, the appellants may fall within the protection afforded by Citadel. On a generous reading of the statement of claim, and given the appellants’ allegations that the OLGC had knowledge sufficient to put a reasonable person on inquiry but failed to do so, the appellants’ claim for knowing receipt of trust funds should be allowed to proceed to trial. A claim for unjust enrichment requires enrichment of the defendant, a corresponding deprivation of the plaintiff and the absence of a juristic reason for the enrichment. The motion judge held that while the OLGC was enriched, and Spinks deprived, there were juristic reasons for the enrichment, namely a gambling contract and the fact that the OLGC was a bona fide purchaser for value without notice that it was receiving fraudulently obtained funds. In Justice Pardu’s view, this conclusion failed to consider that the juristic reasons for the enrichment could have been vitiated on the ground of unconscionability. The appellants’ statement of claim pleaded that the OLGC received an “unconscionable benefit”, a claim that would not necessarily fail if a trier of fact were to determine that the OLGC knew that Spinks was a gambling addict but allowed her to continue gambling at its casinos nonetheless. While a novel argument, the categories of unconscionability can never be closed. Justice Pardu also pointed out that the remedy of a constructive trust may be imposed where required by good conscience in situations where unconscionable unjust enrichment occurs. She suggested that appellants could also rely on the Consumer Protection Act, 2002, S.O. 2002, c. 30, Sched. A, which may be relevant in the case of consumers who are not reasonably able to protect their own interests. The motion judge rejected the appellants’ claim that the OLGC owed them a duty of care and that it acted negligently by permitting Spinks to continue gambling. He held that the OLGC could not owe a duty of care to the appellants unless it owed one to Spinks. He further held that the pleadings did not disclose facts sufficient to establish the required reasonable foreseeability and proximity between casinos and problem gamblers, and cautioned that imposing liability on the OLGC could create a policy problem of indeterminate liability. Pardu J.A. disagreed with the motion judge’s view that the jurisprudence established that there is no duty of care owed by casinos to problem gamblers. While she agreed that casinos cannot be expected to assess their customers to determine whether each individual ought to be gambling, she suggested that “more may be expected” when one such individual is obviously out of control. Pardu J.A. further held that it was too early in the proceedings to determine that the issue of indeterminate liability could arise from recognizing such a duty of care. Justice Pardu acknowledged some “formidable barriers” to a finding that casinos owe a duty of care to third parties who are the victims of problem gamblers. The claim was for pure economic loss and, while the loss may have been reasonably foreseeable, the casinos had no relationship with the third parties. She suggested, however, that this issue might be analogous to that of a commercial host who serves alcohol to an intoxicated patron who then injures a third party when driving drunk. The Supreme Court has recognized a duty of care both to the intoxicated person and to the third party. Pardu J.A. concluded that a factual record was necessary to allow a court to confidently make judgments about the legal and policy issues raised, and to determine “whether it is fair and just to expect casinos to pay some compensation for the high social costs of gambling.” She held that, ultimately, while the appellants’ action was not certain to succeed, it was also not certain to fail. In a thorough dissent, Associate Chief Justice Hoy held that the motion judge did not err in striking the claim and that the appeal should be dismissed. Hoy A.C.J.O. held that there was no reasonable chance that a trier of fact would find that the OLGC had knowledge of circumstances that would put an honest and reasonable person on inquiry as to a breach of trust, and was accordingly liable as constructive trustee. On the issue of unjust enrichment, she held that the appellants could not rely on the doctrine of unconscionability to vitiate the OLGC’s legal basis for retaining the gambled funds, as they did not plead any facts supporting the position that the OLGC’s conduct was unconscionable or outside the normal course of business. She also disagreed with the majority’s view that the Consumer Protection Act could have assisted the appellants. With respect to the claim of negligence, Hoy A.C.J.O. held that the appellants’ claim had no prospect of success in the face of the relevant jurisprudence. The appellants were not proximate to the OLGC and it was not reasonable to expect the OLGC to have considered the appellants when managing its affairs. The Associate Chief Justice disagreed that it was too early in the proceedings to dismiss the claim due to policy concerns of indeterminate liability. Recognizing a duty of care to anyone connected to problem gamblers would result in indeterminate liability. 2. Brown v. University of Windsor, 2016 ONCA 431 (Sharpe, Juriansz and Roberts JJ.A.), June 13, 2016 The Employment Insurance Premium Reduction Program (“EIPRP”) is managed by the Canadian Employment Insurance Commission and governed by the Employment Insurance Act, S.C. 1996, c. 23 and regulations. It allows an employer to reduce its employment insurance premiums if the employer has a wage loss plan equal to the protection provided by Employment Insurance. If an employer is approved and receives a reduction, it must provide a part of the reduction to its employees, proportional to the ratio of EI they paid, in the form of a payment or through added benefits. The respondent, Brian Brown, is president of the University of Windsor Faculty Association. He commenced an action against the appellant, the University of Windsor, on his own behalf and on behalf of present and former members of the faculty, claiming that the university failed to satisfy the requirements of the EIPRP. He alleged in his statement of claim that the appellant received employment insurance premium reductions but did not provide a rebate or upgraded benefits to affected employees and instead used the savings for its own benefit. The appellant moved under Rule 21.01(3)(a) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, for an order dismissing the respondent’s action on the basis that the court lacked jurisdiction to entertain the matter. Relying on the principle set out by the Supreme Court in Weber v. Ontario Hydro, [1995] 2 S.C.R. 929 and Parry Sound (District) Social Services Administration Board v. OPSEU Local 324, 2003 SCC 42, it argued that the “essential character” of the dispute arose out of the administration of the collective agreement and noted that section 48(1) of the Labour Relations Act, 1995, S.O. 1995, c.1, Sch. A (“LRA”) and the collective agreement itself compelled all differences between the parties to proceed to arbitration. Accordingly, exclusive jurisdiction to hear the claim lay with a labour arbitrator. The motion judge rejected this submission, concluding that the essential character of the claim, the appellant’s failure to comply with the provisions of the EIPRP, did not arise out of the terms and conditions of the employment relationship or the collective agreement. The University of Windsor argued on appeal that the motion judge erred in concluding that the court had jurisdiction over the respondent’s claim by relying on the Court of Appeal’s decisions in Rathwell v. Hershey Canada Inc. (2001), 152 O.A.C. 1, leave to appeal to S.C.C. denied, (2002) 164 O.A.C. 279, and the arbitration decision in Hershey Canada Inc. v. United Steelworkers of Canada, Local 461 (1997), 50 C.L.A.S. 249, 1997, and by failing to apply the Supreme Court’s more recent decision in Parry Sound, which, it submitted, effectively overruled the Hershey/Rathwell line of case law. Had he done so, he would have found that an arbitrator has exclusive jurisdiction over the dispute. The Court of Appeal agreed. Writing for the Court, Juriansz J.A. noted that the Hershey/Rathwell cases, like this one, involved claims by unionized employees that their employer had failed to rebate to them the statutorily required portion of the premium reduction under the EIPRP, but observed that the previous courts did not determine the Weber issue that was raised in this case. The motion judge noted that the Hershey/Rathwell decisions did not touch on the Weber question and opined that he was not bound by them, but nonetheless gave them considerable weight. In Juriansz J.A.’s view, the motion judge erred. He should not have been reticent to address the legal issues decided in Hershey/Rathwell, and ought to have considered the matter fresh, as a new legal issue, the Weber issue, was raised. In Weber, and more recently Parry Sound, the Supreme Court confirmed the principle that an arbitrator will have exclusive jurisdiction over a dispute whose “essential character” arises either explicitly or implicitly from the collective agreement. This principle gives effect to the LRA, which provides that all differences between parties to a collective agreement arising from the interpretation, application, administration or alleged violation of that agreement must proceed to arbitration. In conducting a Weber analysis, the court must consider the nature of the dispute and the ambit of the collective agreement. Juriansz J.A. agreed with the appellant that the motion judge erred in characterizing the dispute as a legal one. Instead, he needed to decide whether the facts of the dispute fell within the ambit of the collective agreement. Justice Juriansz held that the motion judge further erred in failing to properly consider section 48(12)(j) of the LRA. The Supreme Court considered section 48(12)(j) in Parry Sound and confirmed its broad scope, holding that it was the legislature’s intent that an arbitrator have the power not only to enforce those rights and obligations that are expressly provided for in the collective agreement, but those that are provided for in human rights and employment-related statutes as well. Juriansz J.A. observed the significant impact of the Supreme Court’s decision on the interpretation and application of s. 48(12)(j) of the LRA, noting that arbitrators have since taken a broad view of their jurisdiction under that provision. Juriansz J.A. considered the reasons in British Columbia Teacher’s Federation v. British Columbia Public School Employers’ Association, 2005 BCCA 92, in which the British Columbia Court of Appeal considered a provision in that province’s Labour Relations Code, which is similar to section 48(12)(j) of the LRA. In that case, Lambert J.A. proposed a single step in determining jurisdiction that requires a violation of the collective agreement as informed by the substantive rights and obligations provided by the employment-related statute. Justice Juriansz held that the British Columbia court’s reasons give proper effect to section 48(12)(j) of the LRA, as interpreted by the Supreme Court in Parry Sound. Adopting these reasons, he concluded that the question to be determined was “whether there is a real contextual connection between the statute and the collective agreement such that a violation of the statute gives rise, in the context, to a violation of the provisions of the collective agreement”. Juriansz J.A. cautioned that in applying this test, the court must recall the principle in Weber that the nature of the dispute is based upon the factual context in which it arises, regardless how it may be legally characterized. Juriansz J.A. found that the impugned provisions in this case could be characterized as “employment-related” under section 48(12)(j) of the LRA. Under the statutory scheme, an employer may achieve a reduction in employment insurance premiums. The employer is in turn obligated to remit to employees a specified share of the premium reduction in the form of cash or enhanced employee benefits. The employees’ entitlement to their share is a substantive right, which informs the interpretation and application of the collective agreement. While the collective agreement does not address the EIPRP explicitly, it does deal with pay and benefits; it is therefore a violation of the collective agreement to fail to provide employees with the pay or benefits to which they are entitled. The “essential character” of this dispute was that the employees alleged that they had not received the full amount of pay or benefits to which they were entitled under the collective agreement. The University of Windsor’s alleged violation of the statute gave rise to a violation of the provisions of the collective agreement. Accordingly, an arbitrator had exclusive jurisdiction over the dispute. 3. Groia v. The Law Society of Upper Canada, 2016 ONCA 471 (MacPherson, Cronk and Brown JJ.A.), June 14, 2016 The Law Society of Upper Canada requires that lawyers conduct themselves with courtesy and civility, while fearlessly advocating on their clients’ behalf. This appeal, which arose from a lawyer’s challenge to the Law Society’s finding of professional misconduct against him, involves the interplay between these foundational duties. The appellant, Joseph Peter Paul Groia, challenged the Law Society Appeal Panel’s findings of professional misconduct against him in relation to his in-court conduct toward opposing counsel, together with the associated penalty and cost award imposed by the Appeal Panel. The Divisional Court upheld the Appeal Panel’s decision and cost award.
Groia, an experienced securities litigator, defended John Felderhof, a senior officer and director of Bre-X Minerals Ltd., on eight charges of violating the Securities Act, R.S.O. 1990, c. S.5. The charges arose out of the collapse of Bre-X as a result of fraudulent claims that it had discovered lucrative gold deposits in Borneo. Felderhof was acquitted of all charges.
The relationship between Groia and the OSC prosecutors was, in the words of the Court of Appeal, “toxic”. Disputes about the prosecution’s failure to meet disclosure obligations arose immediately and Groia was successful in having those addressed. Later there were allegations of prosecutorial misconduct that arose around evidentiary issues. The OSC prosecutors subsequently brought an application for judicial review, arguing among other things, that Groia had repeatedly engaged in uncivil conduct in violation of the LSUC's Rules of Professional Conduct, and that, by failing to control this behaviour, the trial judge had lost jurisdiction and a new trial should be ordered. The application judge and the Court of Appeal agreed with some of the criticisms regarding Groia’s conduct. They dismissed the application for judicial review, however, holding that Groia’s behaviour had not impaired the fairness of the trial. In November, 2009, the Law Society commenced disciplinary proceedings against Groia under the Law Society Act, R.S.O. 1990, c. L.8 (“LSA”), alleging that he had engaged in professional misconduct in his defense of Felderhof. It did so on its own initiative. At no time did anyone complain to the LSUC about Groia’s conduct. The Hearing Panel found that Groia’s attacks on the OSC prosecutors were unjustified and constituted conduct falling below the standards of civility, courtesy and good faith required under the Rules of Professional Conduct. It suspended Groia’s license to practice law for two months and awarded costs of the discipline hearing to the Law Society of $246,960.53. The Appeal Panel found that the Hearing Panel had made improper use of evidence and foreclosed Groia’s defence due to its acceptance of an abuse of process argument advanced by the Law Society that effectively prevented him from contesting the allegations. As a result, it could not defer to the Hearing Panel but undertook its own analysis. On that analysis, it convicted Groia but reduced the length of Groia’s licence suspension to one month and the cost award to $200,000. Groia appealed the Appeal Panel’s decision to the Divisional Court, while the Law Society cross-appealed, asking that the penalty and costs award imposed by the Hearing Panel be restored. The Divisional Court dismissed both the appeal and the cross-appeal. Like the Appeal Panel, it rejected Groia’s submission that only the courts can and should oversee an advocate’s conduct in court and that there are preconditions to the Law Society’s exercise of its disciplinary powers regarding uncivil in-court conduct. The Divisional Court upheld the Appeal Panel’s conclusion that there was no reasonable basis for Groia’s “persistent pattern of personalized attacks on the OSC prosecutors and their integrity.” Importantly, however, the Divisional Court overturned the Appeal Panel on the issue of the correct test for incivility. It concluded Groia was uncivil, but on different grounds. Groia appealed to the Court of Appeal. Writing for the majority of the Court, Cronk J.A. rejected Groia’s claim that the trial judge, and not the Law Society, was in the best position to judge his alleged in-court incivility, noting that his submission ignored the plain language of the LSA and the LSUC’s undisputed statutory obligation to govern the legal profession in the public interest. Cronk J.A. held that the role of trial judges is to decide the contested issues and to safeguard the fairness of the trial, including the dignity and decorum of the proceeding. This is distinct from and does not conflict with or erode the role of the Law Society, which is to ensure the professionalism of its licensees, measured against the standards of practice that apply to the entire profession. Justice Cronk also rejected Groia’s submission that the Appeal Panel erred both in fashioning its test for incivility and in misapplying the test to the facts of the case. She found that the Appeal Panel’s formulation of the test for incivility in this case was reasonable, appropriately balancing the importance of zealous advocacy with the requirement of courtesy and civility, while considering Charter-protected expressive freedoms. The Court held that the findings of professional misconduct against Groia were reasonable. Cronk J.A. cited examples of Groia’s incivility during trial, concluding that his remarks were “uncivil and discourteous and exceeded even the most broadly defined reasonable boundaries of zealous advocacy.” Cronk J.A. emphasized that trials are not just about the resolution of the immediate dispute between the parties. They touch everyone from the trial judge and witnesses, to court staff, to the community at large. As the community’s forum for dispute resolution, trials “engage the public interest in its multiple dimensions,” and the propriety of a lawyer’s in-court conduct must be assessed with this in mind. Justice Cronk concluded that if viewed by an informed and objective member of the public, Groia’s conduct at trial “could only have diminished public confidence in the administration of justice.” Cronk J.A. further held that the Appeal Panel engaged in a balanced and fair assessment of Groia’s circumstances and conduct when fashioning an appropriate penalty, and noted that the penalty is entitled to considerable deference on the reasonableness standard. Groia identified no error in principle in the costs award, or any reason to depart from the general rule that the reasonable costs of investigating and conducting a discipline proceeding should not be borne by the profession as a whole where a determination adverse to the defending lawyer has been made. The Divisional Court’s award of costs to the Law Society also could not be set aside. Its ruling was neither tainted by error in principle nor plainly wrong. However, the Court of Appeal did not award costs for the appeal due to the public interest issues at stake. Brown J.A., dissenting, held that the Divisional Court erred in upholding the Appeal Panel’s finding that Groia was guilty of professional misconduct. Specifically, both the Divisional Court and the Appeal Panel failed to give sufficient consideration to the measures taken by the trial judge to address Groia’s conduct and to Groia’s response, which indicated compliance with his directions. Brown J.A. cautioned that a standard of perfection regarding counsel’s conduct is unreasonable because of the considerable emotion generated at trial. The trial judge is best placed to determine whether an advocate’s conduct is approaching or has crossed over the line that separates zealous advocacy from impermissible conduct. Any regulatory review that fails to consider how the trial judge reacts to a lawyer’s conduct, and how that lawyer responds to judicial direction, ignores a necessary and critical element of the context in which the analysis of the behaviour must take place. Failing to take into account Groia’s responses to judicial directions was an error of law. Justice Brown emphasized that the appeal before the Court was not about the jurisdiction of the Law Society to review how a barrister acts in the courtroom. Rather, “the question is: when the Law Society does review a barrister’s courtroom conduct, what standard of review should a court apply to the regulator’s decision?” Justice Brown noted that the judiciary’s constitutional responsibility for what goes on its courtrooms points to the application of a standard of correctness “so that the judiciary retains the last word, so to speak, about what happens in its courtrooms.”
4. Best v. Ranking, 2016 ONCA 492 (Blair, Pardu and Brown JJ.A.), June 21, 2016
In this decision, the Court of Appeal considered a decision ordering counsel to pay costs personally. Donald Best commenced an action for negligence and economic loss against sixty-two defendants, including three of the respondents in this appeal. The action was stayed on jurisdictional grounds. Several of the defendants successfully moved for a finding of contempt against Best for failure to comply with court orders related to attempts to collect costs from him. Best did not purge his contempt despite being given an opportunity to do so. Instead, he chose to leave the country for some time. He later returned to Canada and applied to purge the finding of contempt, swearing an affidavit that contained accusations of perjury, conspiracy, fraud, obstruction of justice and fabrication of evidence by the opposing parties and their counsel. These accusations were rejected as baseless. His application was dismissed and he served two months in prison. At this point, Best retained the appellant, Paul Slansky. Best then sought to appeal the finding of contempt and the dismissal of his application to have that finding set aside. His repetition of allegations that had been judicially rejected led Feldman J.A. to conclude that the court must “express its condemnation” by awarding costs against him on a full indemnity scale. A panel of the Court of Appeal declined Best’s request to review Justice Feldman’s decision, and Best’s attempts to stay that decision and to obtain leave to appeal to the Supreme Court were also unsuccessful. He did not pay the costs award and his appeal was dismissed. With the appellant as his counsel of record, Best commenced a new action against thirty-nine defendants, including the five respondents to this appeal, alleging intentional torts committed during the contempt proceedings. Counsel for the respondents informed Slansky that they intended to contest jurisdiction and would therefore not be filing a defence. They requested that Slansky not note their clients in default. Respondents’ counsel also advised Slansky that other defendants planned to bring a motion to strike the claim, and requested that the jurisdiction motion be deferred until after the motion to strike was heard. Slansky ultimately did not agree to the deferral, and noted the respondents in default. He refused to agree to set aside the noting in default until four days before that motion was to be argued, after motion materials had already been exchanged. In response, counsel for the respondents advised Slansky that they were considering seeking costs against him personally. Counsel for the respondents informed Slansky on three more occasions that they intended to seek costs against him personally. In one letter, they reasoned: “Fundamentally, your approach to this litigation has been abusive and continues to waste an astonishing amount of money on legal costs.” Motions to strike were subsequently heard by Healey J. On the first day of argument, Slansky conceded that the respondents’ jurisdictional motion should await the outcome of the motion to strike. On the third day of argument, counsel for the respondents again notified Slansky that they intended to seek costs against him personally. On the fourth day of argument, Justice Healey dismissed the action as an abuse of process, making the jurisdiction motion moot. She ordered costs of the action to the respondents on a full indemnity basis. Best’s attempted appeal of this ruling was dismissed when he failed to comply with an order to provide security for costs. The respondents moved for an order pursuant to Rule 57.07(1)(c) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, that Slansky be held jointly and severally liable with Best for all costs awarded in the respondents’ favour in that action, an amount totaling over $160,000. Healey J. found that the second action was an abuse of process, a transparent attempt to re-litigate issues already decided. Rather than being in the interests of justice, the litigation incurred and wasted costs unnecessarily, taxing the resources of the respondents and of an already strained judicial system. She found that Slansky was instrumental both in starting the action and in advancing it in the manner that he did. Concluding that this was a rare case in which counsel should personally pay for costs, Healey J. ordered Slansky to pay costs fixed at $84,000 on a joint and several basis with Best. Slansky appealed, arguing that he did not have a reasonable opportunity to make representations to the court on the particular ground upon which the motion was decided, namely that the action lacked merit and should never have been brought. He further asserted that the motion judge awarded costs against him simply because he took on a case that had little chance of success. Justice Pardu found that Slansky had adequate notice that the merits of the second action would be a component of the Rule 57.07 motion. The motion judge’s finding that Slansky wasted costs unnecessarily by acting on unreasonable instructions from or providing unreasonable advice to his client on the matter of the respondents’ jurisdiction motion was unassailable. It was also open to her to conclude that Slansky could offer no justification for his decision to require the respondents to move to contest jurisdiction immediately rather than await the motion to strike by the other defendants. Pardu J.A. emphasized that the motion judge ordered Slansky to pay costs not because of the strength of his client’s claim, but because of his conduct during the course of the litigation. The motion judge examined the entire course of the litigation in assessing the conduct of counsel, as she was required to do in accordance with Galganov v. Russell (Township), 2012 ONCA 410. She did not err in considering that Slansky advanced accusations of criminal misconduct against opposing counsel that had repeatedly been rejected as baseless. As the Court held in Galganov, deference is owed to a motion judge’s decision as to whether a lawyer should pay costs personally. In Justice Pardu’s view, there was no basis to interfere with the motion judge’s decision to order Slansky to pay a portion of the costs wasted.
5. Trinity Western University v. The Law Society of Upper Canada, 2016 ONCA 518 (MacPherson, Cronk and Pardu JJ.A.), June 29, 2016 Trinity Western University, a private university in British Columbia, wants to establish a law school. Seeking to ensure that its future graduates will be eligible to be called to the bar throughout Canada, TWU applied to the provincial law societies, including the Law Society of Upper Canada ("LSUC"), for accreditation. The benchers of the LSUC denied accreditation on the basis that TWU’s mandate discriminates against members of the LGBTQ community. In its review of the LSUC’s decision, the Court of Appeal reflected on the balance between freedom of religion and freedom of equality in the context of sexual orientation. Anchored in evangelical Christian theology, TWU’s mandate includes a strong opposition to same-sex relationships and marriages, as well as common law relationships outside of marriage. Although there is nothing to prevent members of the lesbian, gay, bisexual, transgender and queer communities from applying to the proposed law school, they would not be admitted without signing and adhering to the Trinity Western University Community Covenant Agreement, which forbids sexual intimacy except between married heterosexual couples. While TWU’s Community Covenant discriminates against LGBTQ students in terms of admission to, and life at, the institution, the university claims that its mandate is protected by its Charter right to freedom of religion. The law societies of the provinces of Alberta, Saskatchewan, Manitoba, New Brunswick, Prince Edward Island, and Newfoundland and Labrador granted accreditation, while those in British Columbia and Nova Scotia refused. The latter decisions were overturned by superior court decisions in those provinces and were recently appealed. In April 2014, by a vote of twenty-eight to twenty-one, the benchers of the LSUC denied accreditation to TWU’s proposed law school. A year later, a three-judge panel of the Divisional Court dismissed the university’s application for judicial review. At the heart of this appeal was the collision and balance of freedom of religion and the right to equality, both of which are enshrined in the Charter and have been interpreted generously by the Supreme Court. The Divisional Court found that the LSUC’s decision not to accredit TWU’s proposed law school infringed TWU’s right to freedom of religion. The court also held, however, that the decision was saved by the LSUC’s proportionate balancing of the Charter rights and values at issue and that it reached a reasonable decision. Writing for the Court of Appeal, MacPherson J.A. held that the Divisional Court was correct in applying a reasonableness standard of review to its consideration of the LSUC’s decision. “Reasonableness” has been adopted as the presumptive standard of review with respect to the decisions of professional regulatory bodies, including those regulating the legal profession, engaged in the interpretation of their enabling statutes. MacPherson J.A. noted that the fact that the LSUC’s decision in this case required a balancing of the TWU’s Charter rights with other Charter values did not alter the standard of review. Administrative tribunals are entitled and required to take account of and to act consistently with Charter values as they make decisions within their mandate. Justice MacPherson noted that in assessing the reasonableness of the LSUC’s decision, the court must consider it in the context of the TWU’s Charter rights, the LSUC’s statutory objectives and whether the decision represents a reasonable balance between the two. MacPherson J.A. agreed with the lower court that the LSUC’s decision infringed on TWU’s right to freedom of religion under s. 2(a) of the Charter. He also agreed, however, that it was entirely appropriate for the LSUC to consider the objectives of the Law Society Act, R.S.O. 1990, c. L.8. (“LSA”), informed by the values found in the Charter and the Ontario Human Rights Code, R.S.O. 1990, c. H.19 (“HRC”), when deciding whether to accredit TWU’s proposed law school. Section 4.1 of the LSA provides that it is a function of the LSUC to ensure that all persons who practise law in Ontario “meet standards of learning, professional competence and professional conduct that are appropriate for the legal services they provide.” Section 4.2 of the LSA provides that in carrying out its functions, duties and powers, the LSUC “has a duty to protect the public interest.”
Justice MacPherson agreed with the Divisional Court that there is no “wall” between these provisions. The LSUC has an obligation to govern the legal profession in the public interest. In setting and maintaining standards of learning, professional competence and professional conduct, it is entitled to do so against the backdrop of the composition of the legal profession, including the goal of promoting a diverse profession. Moreover, that the LSUC is itself subject to the Charter and the HRC means that human rights values must inform how it pursues its objective of ensuring equal access to the legal profession. In assessing whether accreditation of TWU’s proposed law school was in the public interest, the LSUC was required to weigh its goal of promoting a legal profession based on merit and excluding discriminatory classifications against the limit that denying accreditation would place on the TWU’s religious freedom. MacPherson J.A. concluded that the LSUC’s decision struck a reasonable balance between TWU’s Charter rights and its own statutory objectives. He noted that TWU may find it more difficult to operate its law school absent accreditation by the LSUC, but emphasized that the LSUC’s decision does not prevent it from doing so. The decision instead denied a “a public benefit, which the LSUC has been entrusted with bestowing, based on concerns that are entirely in line with the LSUC’s pursuit of its statutory objectives.”
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