A Full Appreciation of Rule 20: Ontario Court of Appeal Establishes New Test for Summary Judgment
The Ontario Court of Appeal has now released its long-awaited reasons on the scope of the amended rule 20 of the Ontario Rules of Civil Procedure. In Combined Air Mechanical Services Inc. v. Flesch, the Court introduced a "full appreciation" test designed to provide guidance on the circumstances in which it will be appropriate for the court to resolve issues on a motion for summary judgment. As discussed below, in our view, more may be required for a "full appreciation" of the scope of amended rule 20.
On January 1, 2010, the Rules of Civil Procedure in Ontario were amended. The most significant amendments were made to rule 20. Former rule 20 provided that the Court shall grant summary judgment if satisfied that there was no genuine issue for trial. Motions for summary judgment were to be heard entirely on a paper record.
The Ontario Court of Appeal interpreted rule 20 extremely narrowly. Rule 20 was limited to situations in which the moving party had demonstrated that there was no genuine issue which requires a trial for resolution. Motion judges were precluded from finding facts. Evaluating credibility, weighing evidence and drawing factual inferences were said to be functions reserved for the trier of fact at trial: see Irving Ungerman Ltd. v. Galanis; Aguonie v. Galion Solid Waste Material Inc; and Dawson v. Rexcraft Storage and Warehouse Inc.
- • the test on a motion for summary judgment is whether there is "no genuine issue requiring a trial" rather than "no genuine issue for trial";
- • judges have the power to weigh evidence, evaluate credibility and draw reasonable inferences from the evidence; and
- • judges may order the presentation of oral evidence, with or without time limits.
Under rule 20.04(2.1), the power to weigh evidence, evaluate credibility and draw reasonable inferences from the evidence shall be exercised by a judge unless "it is in the interest of justice for such powers to be exercised only at a trial."
After the amendments came into force, judges of the Superior Court established a "well-developed body of jurisprudence", as the Court of Appeal described it in Combined Air Mechanical Services. Some Superior Court judges took a relatively expansive view of the amendments, and others took a more restrictive approach, relying on the prior case law. For instance, some cases held that motion judges could not find facts: see e.g. Cuthbert v. TD Canada Trust; Hino Motors Canada Ltd. v. Kell. Others held that the power to weigh evidence, evaluate credibility and draw reasonable inferences necessarily meant that motion judges could find facts on a motion for summary judgment: see e.g. Healey v. Lakeridge Health Corp.; Canadian Premier Life Insurance Co. v. Sears Canada Inc. and Optech v. Sharma. Moreover, it was evident from the case law that motion judges differed in their general attitude and inclination to decide contested issues on motions for summary judgment.
On June 21-23, 2011, the Ontario Court of Appeal sat as a panel of five to consider the scope of amended rule 20. The Court considered five appeals from motions both granting and denying summary judgment under amended rule 20. The Court issued unanimous reasons "by the Court".
The Court expressly declined to "comment on the relative merits of the various interpretive approaches" set out in the body of jurisprudence developed by the Superior Court judges. Rather, the Court chose to mark "a new departure and fresh approach to the interpretation and application of the amended Rule 20."
The Court laid down three types of cases said to be amenable to summary judgment: (1) where the parties agree that it is appropriate to determine an action by way of summary judgment; (2) where the claim or defence is "without merit" or has "no chance of success"; and (3) where the trial process is not required "in the interests of justice".
The Court of Appeal commented extensively on the third category, which is the most significant and controversial. According to the Court, a motion judge must ask the following question when determining whether to resolve all or part of an action under rule 20:
"... can the full appreciation of the evidence and issues that is required to make dispositive findings be achieved by way of summary judgment, or can this full appreciation only be achieved by way of a trial?"
In reaching this conclusion, the Court relied heavily upon standard of review jurisprudence. The Court noted that appellate courts pay deference to findings made by trial judges because they have a "level of appreciation of the issues and the evidence that is required to make dispositive findings" as a result of "living with the case for days, weeks or even months."
The Court contrasted the "privileged position" of the trial judge with the position of a motion judge on a rule 20 motion. The Court noted that motion judges only have written records consisting of affidavits drafted by counsel and that they do not observe witnesses during cross-examination. Furthermore, the review of the record takes place in chambers and does not take the form of a "trial narrative".
According to the Court, the "privileged position" of the trial judge should shed light on when it is in the interest of justice to decide issues summarily. If there is conflicting evidence from a number of witnesses and a voluminous record, the motion judge is said to be unable to achieve a full appreciation of the evidence and the interests of justice will require a trial. By contrast, if the case is "document-driven" with limited testimonial evidence, a motion judge can apparently fully appreciate the evidence. The Court listed the following "hallmarks" of cases that are said to be inappropriate for summary judgment:
- • a voluminous record;
- • large number of witnesses;
- • different theories of liability advanced against multiple defendants;
- • numerous factual issues;
- • credibility determinations which lay at the heart of the disputes;
- • absence of documentary evidence against which to assess the credibility of witnesses.
The Court also noted that the power to order oral evidence under rule 20.04(2.2) is "circumscribed and cannot be used to convert a summary judgment motion into a trial". It is "no more than another tool to better enable the motion judge to determine whether it is safe to proceed with a summary disposition."
Finally, the Court commented briefly on the standard of review on appeal from a summary judgment motion. Whether the motion judge correctly applied the legal test -- whether there is a "genuine issue requiring a trial" -- is to be decided on a standard of correctness. Factual determinations by the motion judge attract a review on the standard of palpable and overriding error.
The Court of Appeal's "full appreciation" test and its extensive reliance on standard of appeal jurisprudence to inform rule 20 is curious. While it is true that appellate courts pay deference to factual findings of trial judges on the basis that they see and hear the evidence, the Court of Appeal has consistently held that deference should also be accorded to motion judges deciding cases on a purely paper record, including motions for summary judgment: see e.g. Morton v. Cowan; Equity Waste Management of Canada v. Halton Hills (Town).
Indeed, as discussed above, the Court of Appeal in Combined Air Mechanical Services held that a palpable and overriding error standard should apply on appeal from a factual finding made on a summary judgment motion. It is therefore somewhat strange that the Court would place such significance on the ability of a trial judge to hear and see the witnesses and "live with the evidence".
Furthermore, although the Court held that a correctness standard applies to the motion judge's articulation and application of the legal test under rule 20, on the whole, the Court of Appeal's reasons were generally deferential to the rulings of the motion judges in the five appeals at issue.
It will remain to be seen whether the nomenclature of "full appreciation" will provide clarity on the scope of amended rule 20. As the Court of Appeal acknowledged in its reasons, the inquiry under rule 20 "depends on the nature of the issues posed and the evidence led" and "must be made on a case-by-case basis." That being said, the "hallmarks" identified by the Court will likely provide some indicia on the circumstances in which it is appropriate for a court to resolve issues on summary judgment motions.
Combined Air Mechanical Services v Flesch, 2011 ONCA 764
Ontario Court of Appeal Docket Number: C51986
Date of Decision: December 5, 2011
full appreciation test no genuine issue requiring a trial Ontario Court of Appeal Rule 20 Rules of Civil Procedure summary judgment