“The leading case on classifying legal issues as questions of law, fact or mixed fact and law is Canada (Director of Investigation and Research, Competition Act) v. Southam Inc., 1997 CanLII 385 (SCC), [1997] 1 S.C.R. 748 (“Southam“). In Southam, the Supreme Court of Canada commented, at para. 35, that, “[b]riefly stated, questions of law are questions about what the correct legal test is; questions of fact are questions about what actually took place between the parties; and questions of mixed law and fact are questions about whether the facts satisfy the legal tests.”
The parties agree on the appropriate standards of review. The standard of review on questions of law is correctness, while findings of fact and factual inferences are reviewable for palpable and overriding error: Housen v. Nikolaisen, 2002 SCC 33, [2002] 2 S.C.R. 235, at paras. 8, 10 and 25. A question of mixed fact and law involves the application of a legal standard to a set of facts, and is subject to review for palpable and overriding error, except for extricable questions of law: Housen, at para. 26. A question of law may be extricable from a question of mixed fact and law if, for example, the incorrect legal standard is applied, or a part of a legal test is not considered by the decision-maker. The extricable question of law is reviewed on a correctness standard.
The standard of palpable and overriding error was further articulated by the Ontario Court of Appeal in Waxman v. Waxman, 2004 CanLII 39040 (ON CA), at paras. 296, 297 and 300:
[296] The “palpable and overriding” standard addresses both the nature of the factual error and its impact on the result. A “palpable” error is one that is obvious, plain to see or clear: Housen at 246. Examples of “palpable” factual errors include findings made in the complete absence of evidence, findings made in conflict with accepted evidence, findings based on a misapprehension of evidence and findings of fact drawn from primary facts that are the result of speculation rather than inference.
[297] An “overriding” error is an error that is sufficiently significant to vitiate the challenged finding of fact. Where the challenged finding of fact is based on a constellation of findings, the conclusion that one or more of those findings is founded on a “palpable” error does not automatically mean that the error is also “overriding”. The appellant must demonstrate that the error goes to the root of the challenged finding of fact such that the fact cannot safely stand in the face of that error: Schwartz v. Canada, 1996 CanLII 217 (SCC), [1996] 1 S.C.R. 254 at 281.
[300]…First and foremost, as indicated above, the “palpable and overriding” standard applies to all factual findings whether based on credibility assessments, the weighing of competing evidence, expert evidence, or the drawing of inference from primary facts.
In Spadacini-Kelava v. Kelava, 2020 ONSC 5561 (CanLII), at para. 32, Kurz, J. referred to the decision of Desormeau, J. in Rosenberg v. Yanofsky, 2019 ONSC 6886, as offering an excellent review of the law regarding the standard of review of the decision of an arbitrator in a family law proceeding, in which she wrote:
7 The decision of an arbitrator deserves as much deference on appeal as does a decision of a trial judge: Palmer v. Palmer, 2010 ONSC 1565 (Ont. S.C.J.) at para. 3 (cited in Reati v. Racz, 2016 ONSC 1967, at para. 28)
8 In reaching an award, an arbitrator sits in the same position as a judge in a lower court when a decision is appealed to a higher court, and for a decision to be overturned on appeal, the appellate court must find that the reasons amount to an error [in] law and that the decision is not correct, or that a palpable and overriding error was made on a question of mixed fact and law: Gray v. Brusby, 2008 CarswellOnt 4045 (Ont. S.C.J.) at para. 27, and Palmer, supra, at para. 5, cited in Reati v. Racz, 2016 ONSC 1967, at para. 29.
…
13 The Court should not interfere with an arbitrator’s award unless it is satisfied that the arbitrator acted on the basis of a wrong principle, disregarded material evidence, or misapprehended the evidence: O’Connell v. Awada, 2019 ONSC 273, at para. 9, citing with approval Robinson v. Robinson, [2000] O.J. No. 3299 (Ont. S.C.J.), at para. 5.
The issues raised in this appeal involve questions of law; questions of fact; and questions of mixed fact and law. The Arbitrator’s determinations with respect to questions of fact and mixed fact and law are entitled to deference and cannot be interfered with unless they amount to palpable and overriding error in facts or in mixed fact and law. The question is whether, the Arbitrator erred, with respect to identifying the correct legal test (an error of law), or correctly identified the legal test but erred in applying the test to the facts (an error of mixed fact and law).
Due to the fact-based and discretionary nature of family law cases, trial judges and arbitrators must be afforded a high degree of deference: see Wright v. Holmstrom, 2016 ONCA 360.”