February 26, 2021 – Kerr v. Baranow Distilled

“Peters does not suggest that the trial judge erred in his articulation of the law. The Supreme Court of Canada set out the law on unjust enrichment arising from a common law relationship in Kerr v. Baranow, 2011 SCC 10, [2011] 1 S.C.R. 269. The court: (i) determines if there has been an unjust enrichment, by determining whether the defendant has been enriched and the claimant has suffered a corresponding deprivation; if so then (ii) there must be no reason in law or justice for the defendant to keep the benefits conferred by the claimant.

If an unjust enrichment has been established, the concept of joint family venture comes into play when considering remedy. The Kerr v. Baranow factors to be considered in determining whether a joint family venture exists are:

•   Mutual effort – did the parties pool their efforts and work towards a common goal?

•   Economic integration – how extensively were the parties’ finances integrated?

•   Actual intent – did the parties intend to have their lives economically intertwined?

•   Priority of the family – to what extent did the parties give priority to the family in their decision making?”

Peters v. Swayze, 2018 ONCA 189 (CanLII) at 7-8

February 25, 2021 – Retroactive Variation of Child Support

“In Corcios v. Burgos, 2011 ONSC 3326, Chappel J. adapted the D.B.S. principles to a motion to change a child support order where the payor requested a retroactive decrease in support or rescission of arrears. I find it hard to improve on the analysis set out at para. 55 of her reasons.  I adopt her analysis and summarize the key principles below.

First, when applying the adapted D.B.S. principles on a motion to retroactively vary child support, one must always keep in mind the ultimate issue: namely, the best interests of the child: DiFrancesco, at para. 24.  As Chappel J. stated, “Ultimately, the goal in addressing child support issues is to ensure that children benefit from the support they are owed when they are owed it, and any incentives for payor parents to be deficient in meeting their child support obligations should be eliminated.”

Next, a court should distinguish cases where a payor seeks relief from payment of arrears based on current inability to pay from those where arrears accumulated due to a change in the payor’s circumstances that affected the payor’s ability to make the child support payments when they came due.

A payor’s request for relief from payment of arrears based on a current inability to pay generally will not result in the rescission or reduction of arrears unless the payor has established, on a balance of probabilities, that he cannot and will not ever be able to pay the arrears. Evidence that the recipient agreed to non-payment of the support is irrelevant, as child support is the right of the child and cannot be bargained away by the recipient parent.

Where, however, the payor demonstrates that a change in circumstances took place during the time that arrears were accumulating which rendered the payor unable to make child support payments for a substantial period of time, the court may provide relief by varying the child support order or rescinding arrears. As Chappel J. stated: “[the court] may determine that it is appropriate to retroactively suspend enforcement of the support order during the time when the payor was unable to pay, or decrease the amount of child support owed during that time and reduce or rescind the arrears owing accordingly.”

Gray v. Rizzi, 2016 ONCA 152 (CanLII) at 55-59

February 24, 2021 – Mobility Motions 

“Interim motions requesting a move of the residence of children pending a trial on the issues of custody and mobility pose their own unique challenges and problems.   Justice McSorley in Kennedy v. Hull, 2005 ONCJ 275 (Ont. C.J.) (CanLII) at paragraph 9 stated:

“The problem is that it is difficult, if not impossible, in many cases to complete the extensive child-focussed inquiry required under Gordon v Goertz on the conflicting and incomplete affidavit evidence that is often available on interim motions.  The courts’ general reluctance to effect fundamental changes in a child’s lifestyle on interim motions has resulted in a slightly more restrictive approach to interim mobility cases that recognize the short-term nature of interim orders and the summary nature of interim motions.”

Justice Marshman in Plumley v. Plumley, (1999), 1999 CanLII 13990 (ON SC), 90 A.C.W.S. (3d) 740, [1999] O.J. No. 3234, at paragraph 7, stated that the following considerations apply to interim motions regarding mobility pending trial:

It appears to me that the following factors are or ought to be important in deciding the mobility issue on an interim basis:

1.  A court will be more reluctant to upset the status quo on an interim basis and permit the move when there is a genuine issue for trial.

2.  There can be compelling circumstances that might dictate that a judge ought to allow the move.  For example, the move may result in a financial benefit to the family unit, which will be lost if the matter awaits a trial or the best interests of the children might dictate that they commence school at a new location.

3.  Although there may be a genuine issue for trial, the move may be permitted on an interim basis if there is a strong probability that the custodial parent’s position will prevail at a trial.”

As stated in Kennedy v. Hull, where there is incomplete and/or conflicting evidence, courts are generally reluctant to sanction fundamental changes to a child’s lifestyle and circumstances on an interim basis.”

Araujo v. Sheinman, 2020 ONSC 1185 (CanLII) at 25-27

February 23, 2021 – Hearsay Evidence

“As part of its case, the Society seeks to tender out-of-court statements made by the child to three child protection workers and to her counsellor.  Other statements made by the child will also be tendered as evidence of her state of mind under the recognized exception to the hearsay rule.  The introduction of the statements into evidence is not opposed by the mother or the OCL.  Admissibility is challenged by the father, at this point on whether the threshold necessity test has been met.

In R. v. Khelawon, 2006 SCC 57 (CanLII), [2006] 2 S.C.R. 787, Charron J. notes that the requirements of necessity and reliability are related.  She states at para 49: 

“The broader spectrum of interests encompassed in trial fairness is reflected in the twin principles of necessity and reliability. The criteria of necessity is founded on society’s interest in getting at the truth. Because it is not always possible to meet the optimal test of contemporaneous cross-examination, rather than simply losing the value of the evidence, it becomes necessary in the interests of justice to consider whether it should nonetheless be admitted in its hearsay form.  The criterion of reliability is about ensuring the integrity of the trial process.  The evidence, although needed, is not admissible unless it is sufficiently reliable to overcome the dangers arising from the difficulty of testing it.”

 

Accordingly, while somewhat unusual to consider the threshold issues individually, all parties agreed that threshold reliability should be addressed subsequently.   

The Supreme Court of Canada articulated what is known as the principled exception to the rule against hearsay in the well-known case of Khan v. R., 1990 CanLII 77 (SCC), 1990 CarswellOnt 108. The first question to be determined is whether the reception of the hearsay statement is reasonably necessary. At paragraph 31 in Khan, the Supreme Court said that,

“The inadmissibility of the child’s evidence might be one basis for a finding of necessity. But sound evidence based on psychological assessments that testimony in court might be traumatic for the child or harm the child might also serve. There may be other examples of circumstances which would establish requirement of necessity.”

 

In the Law of Evidence in Canada, third edition, Bryant, Lederman, Fuerst, the authors’ state at paragraph 6.96:

“Necessity relates to relevance and availability of evidence.  There are various degrees of necessity, ranging from the fact that the declarant is deceased, or ill, or incompetent to testify, or otherwise unavailable, to the fact that, although he or she is available to testify, little would be gained by the declarant’s attendance in court.”

Children’s Aid Society of Ottawa v. C.L., 2018 ONSC 1241 (CanLII) at 3-6

February 22, 2021 – Severing Joint Tenancy

“Courts in this province have routinely referred to Walters (Re) and Ginn in deciding whether negotiations between spouses during a marriage breakdown have revealed an intention to mutually treat the interests in a matrimonial home as constituting a tenancy in common: see, e.g., McKee and National Trust Co. (Re) (1975), 1975 CanLII 442 (ON CA), 7 O.R. (2d) 614, [1975] O.J. No. 2234 (C.A.), at pp. 618-19 O.R.; Sampaio Estate v. Sampaio, 1992 CanLII 8603 (ON SCDC), [1992] O.J. No. 771, 90 D.L.R. (4th) 122 (Gen. Div.), at pp. 126-28 D.L.R.; Robichaud, at pp. 46-47 O.R.; Jurevicius v. Jurevicius, [2011] O.J. No. 698, 2011 ONSC 696 (S.C.J.), at paras. 21-22. Courts in other provinces have taken a similar approach in applying the course of dealing test in this context: see, e.g., Tessier Estate v. Tessier, [2001] S.J. No. 515, 2001 SKQB 399, 211 Sask. R. 50 (Q.B.), at para. 12; Lam v. Le Estate, [2002] M.J. No. 35, 2002 MBQB 31, 25 R.F.L (5th) 72, at paras. 18-20; [page255] Davison v. Davison Estate, [2009] M.J. No. 340, 2009 MBCA 100, 251 Man. R. (2d) 1 (C.A.), at para. 4.

However, the British Columbia Court of Appeal has framed the course of dealing test somewhat differently than have courts in Ontario and elsewhere in Canada. In Tompkins Estate, the court considered the meaning of the course of dealing test in the context of a marriage breakdown. Southin J.A., speaking for the court, expressed the view, at p. 199 D.L.R., that in articulating the third rule of severance in Williams v. Hensman, the vice-chancellor was “postulating a species of estoppel”. In her view, for severance to be established through a course of dealing, there must be evidence of detrimental reliance such as would ordinarily be required to invoke the doctrine of estoppel. Southin J.A. declared, at p. 199 D.L.R., that “in so far as the judgment in Ginn v. Armstrong . . . was founded on an application of the third category inconsistent with this judgment” — that is, that did not require evidence of detrimental reliance — “it can no longer be considered good law in this province”. 

Southin J.A. may have been correct in stating that the vice-chancellor applied the course of dealing test to what was, on the facts of Williams v. Hensman, an instance of estoppel. However, to the extent that Southin J.A. interprets rule 3 as a “species of estoppel” requiring proof of detrimental reliance, I cannot agree.

In describing the course of dealing test, the reasons of the vice-chancellor in Williams v. Hensman do not refer to the doctrine of estoppel, nor do his reasons invoke the concept of detrimental reliance. It is possible that Southin J.A. may have viewed the course of dealing test as a species of estoppel because both legal principles are designed to prevent unfairness or injustice as between the parties. However, the elements of each doctrine are different, as are the requirements of proof.

An estoppel may be established through evidence that one party made a representation, whether communicated expressly or through conduct, to another and that the other party relied on that representation to his or her detriment: see Ryan v. Moore, [2005] 2 S.C.R. 53, [2005] S.C.J. No. 38, 2005 SCC 38, at paras. 67-69; Scotsburn Co-operative Services Ltd. v. WT Goodwin Ltd., 1985 CanLII 57 (SCC), [1985] 1 S.C.R. 54, [1985] S.C.J. No. 2, at pp. 65-66 S.C.R. Upon such facts being established, the doctrine of estoppel may be applied to prevent the party from resiling from his or her representation to prevent unfairness.

In contrast, a course of dealing that is sufficient to establish a severance of a joint tenancy requires that the co- owners knew of the other’s position and that they all treated their respective interests in the property as no longer being held jointly. However, unlike in the case of an estoppel, the course of dealing test does not require proof that a party relied to his/her detriment on a representation that a co-owner no longer wants to hold the property jointly. The rationale for severing the joint tenancy relates to the inappropriateness of the right of survivorship in circumstances where the co-owners have mutually treated their interests in the property as being held in common. The rationale is not contingent on the fact that one party relied on the representation to his/her detriment. 

Indeed, a likely act of reliance in a course of dealing case would be the act of refraining from pursuing other methods of severance based on the understanding that the co-owners were mutually treating the property as a tenancy in common. However, it would be difficult to prove that the failure to pursue a different means of severance was attributable to reliance. Moreover, the challenge in proving reliance is significantly complicated by the fact that such evidence is unlikely to become relevant until after the death of the individual who is said to have relied on the representation.

In addition to generally disagreeing with Southin J.A.’s view in Tompkins that the course of dealing test is a form of estoppel requiring evidence of detrimental reliance, I respectfully cannot agree with Southin J.A.’s specific characterization of the third rule as requiring the presence of “facts which preclude one of the parties from asserting that there was no agreement” (at p. 199). Rule 3 does not require evidence of an agreement. As noted above, the English Court of Appeal concluded in Burgess that the presence of an agreement is not part of the analysis under rule 3. A request for severance in those circumstances would be dealt with under rule 2. Rule 3 relates more broadly to evidence disclosing a course of conduct indicating that the interests in the property were being held in common and not jointly.
(2) Applying the course of dealing test to the facts of this case, the application judge erred in applying the test to the evidence.”

Hansen Estate v. Hansen, 2012 ONCA 112 (CanLII) at 44-51

February 19, 2021 – Certificates of Pending Litigation

“Having dispensed with these procedural issues, this court must determine whether the certificate of pending litigation should be placed on the property in this case.

As stated in 2254069 Ontario Inc. v. Kim, 2017 ONSC 5003, relying on Interrent International Properties Inc. v. 1167750 Ontario Inc., [2013] O.J. No. 3385 (S.C.J.), “The Court may only grant leave to register a CPL where it is satisfied that there is a triable issue in respect of the moving party’s claim to an interest in the land.”  In Kim, Justice Petersen was satisfied that there was a triable issue with respect to the Applicant’s claim to an interest in the land.  However, the court went on to consider other relevant factors, before ultimately concluding that it would not be just to grant leave to register the certificate of pending litigation.  The court stated:

31  A distillation of the case law and review of s. 103(6) of the Courts of Justice Act establish that the following are relevant factors for consideration on a contested Motion for leave to issue a CPL: (i) whether the land in question is unique, (ii) whether there is an alternative claim for damages, (iii) the ease or difficulty of calculating damages, (iv) whether damages would be a satisfactory remedy, (v) the presence or absence of a willing purchaser, (vi) the balance of convenience, or potential harm to each party, if the CPL is or is not granted, (vii) whether the CPL appears to be for an improper purpose, (viii) whether the interests of the party seeking the CPL can be adequately protected by another form of security and (ix) whether the moving party has prosecuted the proceeding with reasonable diligence. This is not an exhaustive list.

Fairly recently in the case of Guz v. Olszowka, 2019 ONSC 5308 (CanLII), Justice Broad discussed the ordering of a certificate of pending litigation in the context of an estate matter.  The court stated as follows:

27  The principles which have application on a motion to discharge a CPL were succinctly summarized by Master Glustein (as he then was) in Perruzza v. Spatone, 2010 ONSC 841 (Ont. S.C.J.) at para. 20 as follows:

(i)  The test on a motion for leave to issue a CPL made on notice to the defendants is the same as the test on a motion to discharge a CPL (Homebuilder Inc. v. Man-Sonic Industries Inc., 1987 CarswellOnt 499 (Ont. S.C.) (“Homebuilder”) at para. 1);

(ii)  The threshold in respect of the “interest in land” issue on a motion respecting a CPL (as that factor is set out at section 103(6) of the Courts of Justice Act, R.S.O. 1990, c. C. 43) is whether there is a triable issue as to such interest, not whether the plaintiff will likely succeed (1152939 Ontario Ltd. v. 2055835 Ontario Ltd., 2007 CarswellOnt 756 (Ont. S.C.J.), as per van Rensburg J., citing Transmaris Farms Ltd. v. Sieber, [1999] O.J. No. 300 (Ont. Gen. Div. [Commercial List]) at para. 62);

(iii)  The onus is on the party opposing the CPL to demonstrate that there is no triable issue in respect to whether the party seeking the CPL has “a reasonable claim to the interest in the land claimed” (G.P.I. Greenfield Pioneer Inc. v. Moore, 2002 CanLII 6832 (ON CA), 2002 CarswellOnt 219 (Ont. C.A.) at para. 20);

(iv)  Factors the court can consider on a motion to discharge a CPL include (i) whether the plaintiff is a shell corporation, (ii) whether the land is unique, (iii) the intent of the parties in acquiring the land, (iv) whether there is an alternative claim for damages, (v) the ease or difficulty in calculating damages, (vi) whether damages would be a satisfactory remedy, (vii) the presence or absence of a willing purchaser, and (viii) the harm to each party if the CPL is or is not removed with or without security (572383 Ontario Inc. v. Dhunna, 1987 CarswellOnt 551 (Ont. S.C.) at paras. 10-18); and

(v)  The governing test is that the court must exercise its discretion in equity and look at all relevant matters between the parties in determining whether a CPL should be granted or vacated (931473 Ontario Ltd. v. Coldwell Banker Canada Inc., 1991 CarswellOnt 460 (Ont. Gen. Div.); Clock Investments Ltd. v. Hardwood Estates Ltd., 1977 CanLII 1414 (ON SC), 1977 CarswellOnt 1026 (Ont. Div. Ct.) at para. 9).

28 In determining the question of whether there is a triable issue as to an interest in land on a motion to discharge or issue a CPL, the court does not assess the credibility of deponents or decide disputed issues of fact (see HarbourEdge Mortgage Investment Corp. v. Community Trust Co., 2016 ONSC 448 (Ont. S.C.J.) at para. 45).

See also Marmak Holdings Inc. v. Miletta Maplecrete Holdings Ltd. et al., 2019 ONSC 4630.”

Lu v. Lu, 2020 ONSC 1110 (CanLII) at 21-23

February 18, 2021 – Unjust Enrichment Remedies

“In my view, restricting the money remedy to a fee-for-services calculation is inappropriate for four reasons.  First, it fails to reflect the reality of the lives of many domestic partners.  Second, it is inconsistent with the inherent flexibility of unjust enrichment.  Third, it ignores the historical basis of quantum meruit claims.  Finally, it is not mandated by the Court’s judgment in Peter. For those reasons, this remedial dichotomy should be rejected. The discussion which follows is concerned only with the quantification of a monetary remedy for unjust enrichment; the law relating to when a proprietary remedy should be granted is well established and remains unchanged.

The remedial dichotomy would be appropriate if, in fact, the bases of all domestic unjust enrichment claims fit into only two categories — those where the enrichment consists of the provision of unpaid services, and those where it consists of an unrecognized contribution to the acquisition, improvement, maintenance or preservation of specific property.  To be sure, those two bases for unjust enrichment claims exist.  However, all unjust enrichment cases cannot be neatly divided into these two categories.

At least one other basis for an unjust enrichment claim is easy to identify. It consists of cases in which the contributions of both parties over time have resulted in an accumulation of wealth. The unjust enrichment occurs following the breakdown of their relationship when one party retains a disproportionate share of the assets which are the product of their joint efforts.  The required link between the contributions and a specific property may not exist, making it inappropriate to confer a proprietary remedy.  However, there may clearly be a link between the joint efforts of the parties and the accumulation of wealth; in other words, a link between the “value received” and the “value surviving”, as McLachlin J. put it in Peter, at pp. 1000-1001. Thus, where there is a relationship that can be described as a “joint family venture”, and the joint efforts of the parties are linked to the accumulation of wealth, the unjust enrichment should be thought of as leaving one party with a disproportionate share of the jointly earned assets.

There is nothing new about the notion of a joint family venture in which both parties contribute to their overall accumulation of wealth.  It was recognition of this reality that contributed to comprehensive matrimonial property legislative reform in the late 1970s and early 1980s.  As the Court put it in Clarke v. Clarke, 1990 CanLII 86 (SCC), [1990] 2 S.C.R. 795, at p. 807 (in relation to Nova Scotia’s Matrimonial Property Act), “. . . the Act supports the equality of both parties to a marriage and recognizes the joint contribution of the spouses, be it financial or otherwise, to that enterprise. . . . The Act is accordingly remedial in nature.  It was designed to alleviate the inequities of the past when the contribution made by women to the economic survival and growth of the family was not recognized” (emphasis added). 

Unlike much matrimonial property legislation, the law of unjust enrichment does not mandate a presumption of equal sharing.  However, the law of unjust enrichment can and should respond to the social reality identified by the legislature that many domestic relationships are more realistically viewed as a joint venture to which the parties jointly contribute.” 

Kerr v. Baranow, [2011] 1 SCR 269, 2011 SCC 10 (CanLII) at 58-62

February 17, 2021 – Sale of Jointly-Owned Property & Unconscionability Claim

“The relevant law applicable to this motion is that pertaining to an interim order for sale of jointly owned property, in conjunction with a consideration of the law developed under s. 5(6) of the Family Law Act, R.S.O. 1990, c. F.3.  With respect to the latter, even though this is an interim motion it bears keeping in mind that the onus will be on the respondent to satisfy the court that an equal division would be unconscionable. The law is clear that this is an exceptionally high threshold to meet, and that the focus is ultimately on the result of equalization: Serra v. Serra 2009 ONCA 105 (Ont. C.A.); Symmons v. Symmons 2012 ONCA 747 (Ont. C.A.). While the respondent does not have to demonstrate a potentially unconscionable result to defeat this motion, he does need to meet the onus of showing a prima facie case for his claim to an unequal division, as the matrimonial home and boat are the only significant assets owned by these parties from which any such payment could be satisfied: Goldman v. Kudeyla 2011 ONSC 2718 (S.C.J.) at para. 18; Zargar v. Zarrabian 2016 ONSC 2900 (S.C.J.) at para. 8; Bonnick v. Bonnick 2016 ONSC 657 (S.C.J.) at para. 3. As the party resisting the sale, the respondent must alternatively show that the applicant has engaged in malicious, vexatious or oppressive conduct: Latchman v. Latchman, 2002 CarswellOnt 1757 (Ont. C.A.), at para. 2. I use the word “alternatively” because s. 5(6) of the Family Law Act does not specifically require a party to show such conduct.  Failing proof by the respondent of an arguable case for unequal division, the applicant is entitled to exercise her prima facie right under s. 2 of the Partition Act, R.S.O. 1990, c. P.4 to obtain an order for partition and sale of the jointly owned home.”

Lovie v. Lovie, 2017 ONSC 1186 (CanLII) at 4

February 16, 2021 – Retroactive Reduction of Support

“The applicable principles regarding the retroactive reduction of support and rescission of arrears are set out in Gray v. Rizzi, 2016 ONCA 152, in which the Ontario Court of Appeal adopted the analysis set out by Justice Chappel in Corcios v. Burgos, 2011 ONSC 3326. Ultimately, as stated by Justice Chappel, “the goal in addressing child support issues is to ensure that children benefit from the support they are owed when they are owed it, and any incentives for payor parents to be deficient in meeting their obligations should be eliminated.”

Where, as here, a payor can establish that a change in circumstances during the time that the arrears were accumulating, rendered him or her unable to make child support payments for a substantial period of time, the Court may provide relief by varying the child support order or rescinding arrears.” [Emphasis added.] See Corciossupra at para 55. In such a case the following factors must guide the Court:

1. The nature of the obligation for support, whether contractual, statutory, or judicial;

2. The ongoing needs of the support recipient and the child;

3. Whether there is a reasonable excuse for the payor’s delay in applying for relief;

4. The ongoing financial capacity of the payor, and in particular, his ability to make payments towards the outstanding arrears;

5. The conduct of the payor, including whether he has made voluntary payments, whether he cooperated with support enforcement authorities, and whether he has complied with obligations and requests for financial disclosure from the support recipientBehaviour that indicates willful non-compliance with the terms of the Order or a failure to work cooperatively to address the child support issue is a factor that militates against even partial rescission of arrears.

6. Delay on the part of a support recipient, even a long delay, in enforcing the child support obligation does not, in and of itself, constitute a waiver of the right to arrears;

7. Any hardship that may be occasioned by a retroactive order reducing or rescinding arrears, or by an order requiring the payment of substantial arrears.

See Gray, supra, at 61. [Emphasis added]

Full, frank, and timely disclosure of the basis for the request for a reduction in child support is an important consideration. As stated by Justice Chappel in Corcios, supra at 55:

[I]f a retroactive Order reducing child support would result in the child support recipient having to repay money to the child support payor, this may militate against making the order, particularly if the payor has not given the recipient notice of the change in their circumstances, has not provided appropriate disclosure to support their claim to an adjustment, or has delayed initiating court proceedings to change the Order.

In Gray, supra, Justice Brown of the Ontario Court of Appeal stressed that the payor seeking retroactive reduction or rescission of arrears must provide “reasonable proof” to support the claim so that the recipient can “independently assess the situation in a meaningful way and respond appropriately.” Justice Brown further noted that the obligation is ongoing and that the failure to comply with continuing disclosure obligations will “most likely… impact the remedy which the Court crafts.” See para. 63.”

Smith v. Davies, 2018 ONSC 920 (CanLII) at 81-84

February 12, 2021 – Minutes of Settlement

“Minutes of Settlement are a type of contract. The Supreme Court of Canada has provided guidance where there is an ambiguity or a question of interpretation regarding a contract. In BG Checo International Ltd. v. British Columbia Hydro and Power Authority, 1993 CanLII 145 (SCC), [1993] 1 S.C.R. 12, at para. 9, the Supreme Court stated:

It is a cardinal rule of the construction of contracts that the various parts of the contract are to be interpreted in the context of the intentions of the parties as evident from the contract as a whole.

The primary goal of contractual interpretation is to ascertain the objective intent of the parties as expressed in the written agreement. The interpretation must be grounded in the text. A judge should interpret a plainly worded document by presuming that the parties intended the legal consequences of their words: Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, [2014] 2 S.C.R. 633, at paras. 47, 55, 57.

In Sattva, at para. 47, the Supreme Court held that when interpreting a contract, the courts should have regard to the surrounding circumstances of the contract – the factual matrix, while “giving the words used in the contract their ordinary and grammatical meaning, consistent with the circumstances known to the parties at the formation of the contract.”

The factual matrix of a contract includes objective evidence of the background facts at the time of the execution of the contract. The scope of the factual matrix evidence is limited to objective facts and does not include the subjective intention of the parties: Sattva, at para. 58.

In Union Carbide Canada Inc. v. Bombardier Inc., 2014 SCC 35, [2014] 1 S.C.R. 800, the Supreme Court held that the common law exception of confidentiality in mediation proceedings is displaced to enable the parties to produce evidence of communications made in the mediation process in order to prove the terms of settlement.

Evidence of post-contractual conduct is admissible to assist in contractual interpretation, but “only if the contract remains ambiguous after considering its text and its factual matrix:” Shewchuk v. Blackmont Capital Inc., 2016 ONCA 912, 404 D.L.R. (4th) 512, at para. 46.”

Gelb v. Gelb, 2020 ONSC 760 (CanLII) at 27-32