Ontario Court of Appeal Introduces New “Full Appreciation” Test for Summary Judgment

The Court of Appeal for Ontario has released an important decision in Combined Air Mechanical Services Inc. v. Flesch2011 ONCA 764 [“Flesch”], which creates a new judicial test for summary judgment: the “full appreciation” test.

A five-judge panel was convened to hear five appeals from decisions under the amended Rule 20  for Summary Judgment (Combined Air Mechanical v. Flesch  (C51986); Mauldin v. Hryniak (C52912); Bruno Appliance and Furniture v. Hryniak  (C52913); 394 Lakeshore Oakville Holdings Inc. v. Misek (C53035); and Parker v. Casalese  (C53395)). In some of these cases, summary judgment was granted, while in others the motion was dismissed in whole or in part. Each of the decisions raised interpretive issues of the new Rule 20, introduced on January 1, 2010, as part of a significant package of amendments to the Rules of Civil Procedure, R.R.O. 1990, Reg. 194.

According to the Ontario Court of Appeal:

“Motivating the amendments was the overriding objective of making the litigation system more accessible and affordable for Ontarians. Reflecting this objective, the touchstone of proportionality was introduced as a guiding interpretative principle under the Rules. To this end, rule 1.04(1.1) requires courts to “make orders and give directions that are proportionate to the importance and complexity of the issues, and to the amount involved, in the proceeding.”  including the nature of the test for determining whether or not summary judgment should be granted, the scope and purpose of the new powers that have been given to judges hearing motions for summary judgment, and the types of cases that are amenable to summary judgment.”

In addition to hearing from counsel for the parties in all five appeals, the Court of Appeal granted leave to hear from five amicus curiae to provide submissions on how the amended rule should be interpreted and applied: the Attorney General of Ontario, The Advocates’ Society, the Ontario Bar Association, the Ontario Trial Lawyers Association, and The County and District Law Presidents’ Association. The amicus were asked to address the meaning and scope of the amended Rule 20, but not to take a position on the facts or merits of any of the decisions under appeal.

In a lengthy 266 paragraph per curiam judgment (per Winkler C.J.O., Laskin, Sharpe, Armstrong and Rouleau JJ.A.), the Court of Appeal undertakes a historical review of Rule 20 before the 2010 amendments, including a review of some of the leading cases interpreting the former rule, followed by an examination of the findings and recommendations of the former Associate Chief Justice of Ontario, the Honourable Coulter A. Osborne, Q.C., in his report entitled Civil Justice Reform Project: Summary of Findings and Recommendations (Toronto: Ontario Ministry of the Attorney General, 2007) (“the Osborne Report”). The Court then embarks on an analysis of the 2010 amendments to determine the extent to which Mr. Osborne’s recommendations concerning summary judgment were implemented with an effort to explain the general principles to be followed in applying the amended Rule 20.  Finally, the Chief Justice applies these principles to the five appeals before the court.

While noting that the amended rule expands the power of a motions judge to weigh the evidence, evaluate credibility, and draw reasonable inferences from the evidence, this power must be exercised only where “there is no factual or legal issue raised by the parties that requires a trial for its fair and just resolution.” The Court of Appeal identifies three types of cases amendable to summary judgment: 1) where the parties consent or agree that summary judgment is appropriate; 2) where the claim or defence has no chance of success and 3) where the motion judge is satisfied that the issues can be fairly and justly resolved by exercising the powers in rule 20.04(2.1).

The Court of Appeal in Flesch introduces a new judicial test for summary judgment: the “full appreciation” test. As the appeal panel explains:

[51]         We think this “full appreciation test” provides a useful benchmark for deciding whether or not a trial is required in the interest of justice. In cases that call for multiple findings of fact on the basis of conflicting evidence emanating from a number of witnesses and found in a voluminous record, a summary judgment motion cannot serve as an adequate substitute for the trial process. Generally speaking, in those cases, the motion judge simply cannot achieve the full appreciation of the evidence and issues that is required to make dispositive findings.  Accordingly, the full appreciation test is not met and the “interest of justice” requires a trial.

[52]         In contrast, in document-driven cases with limited testimonial evidence, a motion judge would be able to achieve the full appreciation of the evidence and issues that is required to make dispositive findings. Similarly, the full appreciation test may be met in cases with limited contentious factual issues. The full appreciation test may also be met in cases where the record can be supplemented to the requisite degree at the motion judge’s direction by hearing oral evidence on discrete issues.

[53]         We wish to emphasize the very important distinction between “full appreciation” in the sense we intend here, and achieving familiarity with the total body of evidence in the motion record. Simply being knowledgeable about the entire content of the motion record is not the same asfully appreciating the evidence and issues in a way that permits a fair and just adjudication of the dispute. The full appreciation test requires motion judges to do more than simply assess if they are capable of reading and interpreting all of the evidence that has been put before them.

[54]         The point we are making is that a motion judge is required to assess whether the attributes of the trial process are necessary to enable him or her to fully appreciate the evidence and the issues posed by the case. In making this determination, the motion judge is to consider, for example, whether he or she can accurately weigh and draw inferences from the evidence without the benefit of the trial narrative, without the ability to hear the witnesses speak in their own words, and without the assistance of counsel as the judge examines the record in chambers.

[55]         Thus, in deciding whether to use the powers in rule 20.04(2.1), the motion judge must consider if this is a case where meeting the full appreciation test requires an opportunity to hear and observe witnesses, to have the evidence presented by way of a trial narrative, and to experience the fact-finding process first-hand. Unless full appreciation of the evidence and issues that is required to make dispositive findings is attainable on the motion record – as may be supplemented by the presentation of oral evidence under rule 20.04(2.2) – the judge cannot be “satisfied” that the issues are appropriately resolved on a motion for summary judgment.

The Court of Appeal adds,

[57]         However, we add an important caveat to the “best foot forward” principle in cases where a motion for summary judgment is brought early in the litigation process.  It will not be in the interest of justice to exercise rule 20.04(2.1) powers in cases where the nature and complexity of the issues demand that the normal process of production of documents and oral discovery be completed before a party is required to respond to a summary judgment motion. In such a case, forcing a responding party to build a record through affidavits and cross-examinations will only anticipate and replicate what should happen in a more orderly and efficient way through the usual discovery process.

[58]         Moreover, the record built through affidavits and cross-examinations at an early stage may offer a less complete picture of the case than the responding party could present at trial. As we point out below, at para. 68, counsel have an obligation to ensure that they are adopting an appropriate litigation strategy. A party faced with a premature or inappropriate summary judgment motion should have the option of moving to stay or dismiss the motion where the most efficient means of developing a record capable of satisfying the full appreciation test is to proceed through the normal route of discovery. This option is available by way of a motion for directions pursuant to rules 1.04(1), (1.1), (2) and 1.05.

Noting the institutional benefits of trial management under Rule 20.05 and the removal of the presumption against the moving party of a substantial indemnity costs award under Rule 20.06, the Court of Appeal signals a heightened obligation of the Bar in formulating litigation strategy:

[68]         It is important to underscore the obligation that rests on members of the bar in formulating an appropriate litigation strategy. The expenditure of resources, regardless of quantum, in the compilation of a motion record and argument of the motion is not a valid consideration in determining whether summary judgment should be granted. It is not in the interest of justice to deprive litigants of a trial simply because of the costs incurred by the parties in preparing and responding to an ill-conceived motion for summary judgment.

Finally, the Court of Appeal notes that for summary judgment motions brought under Rule 76-Simplified Procedure, “the judge will not only have to apply the full appreciation test, but will also need to assess whether entertaining the motion is consistent with the efficiency rationale reflected in the simplified procedures under Rule 76.

In my view, the new “full appreciation” test reinforces the judge’s gatekeeping role in vetting unmeritorious claims or defences, while retaining trials as the primary means of resolving disputes and dispensing civil justice.  The new “full appreciation” test acknowledges that some cases are, by their nature, necesssarily complex and not amenable to summary disposition. The Court of Appeal in Flesch recognizes that while the recent Rule amendments have lessened the institutional barriers to litigants having their day in court—by reducing some of the systemic issues of increased legal costs and delay— there are some cases that still require a full trial within an adversarial system of justice. In this sense, the “full appreciation” test strikes a reasonable balance more akin to “equal access to justice”. As the learned Chief Justice notes,

[38]         However, we emphasize that the purpose of the new rule is to eliminate unnecessary trials, not to eliminate all trials. The guiding consideration is whether the summary judgment process, in the circumstances of a given case, will provide an appropriate means for effecting a fair and just resolution of the dispute before the court.

[39]         Although both the summary judgment motion and a full trial are processes by which actions may be adjudicated in the “interest of justice”, the procedural fairness of each of these two processes depends on the nature of the issues posed and the evidence led by the parties. In some cases, it is safe to determine the matter on a motion for summary judgment because the motion record is sufficient to ensure that a just result can be achieved without the need for a full trial. In other cases, the record will not be adequate for this purpose, nor can it be made so regardless of the specific tools that are now available to the motion judge. In such cases, a just result can only be achieved through the trial process.  This pivotal determination must be made on a case-by-case basis.”

(h/t David L Sterns, co-counsel for amicus curiae, Ontario Bar Association via Twitter: @david_sterns)

Addendum: As Fred Myers of Goodmans LLP on Twitter points out, the judgment is “By the Court”. Although the Chief Justice has initialled the judgment (see last paragraph), he is not the author of the judgment. As noted in the Court of Appeal for Ontario circular posted by John Kromkamp, Senior Legal Officer “Information for Members of the Media and Public regarding the “Author” of Judgments“:

When all of the judges have signed a decision that has been under reserve, it is ready to be released to the parties and made available to the public. The final task of the president of the panel that heard the appeal is to verify that it is ready to be released and authorize its release to the parties by staff members of the Court of Appeal. This administrative step is traditionally confirmed by endorsing his or her initials on the last page of the decision. As a result, these initials do not signify the author of the decision. [emphasis added]

2 Responses to “Ontario Court of Appeal Introduces New “Full Appreciation” Test for Summary Judgment”

  1. Mat Wilson (@matwilson6) Says:

    The law is straightforward when it is applied.

    [Link removed as per my comment policy]

  2. Happy Trails and Happy Trials: Supreme Court of Canada Rules the Test for Summary Judgment | THE TRIAL WARRIOR BLOG Says:

    […]  Today’s Supreme Court of Canada decisions on the summary judgment appeals in Hryniak v. Mauldin, 2014 SCC 7 and  Bruno Appliance and Furniture, Inc. v. Hryniak, 2014 SCC 8  offers a somewhat less than “full appreciation” of the test summary judgment established by the Court of Appeal for Ontario. [See my backgrounder on the Court of Appeal for Ontario's "full appreciation" test  here.]  […]

Leave a Reply

Please log in using one of these methods to post your comment:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: