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In a Rare Ruling, Appeal Court Declares Ontario Judge Was Biased

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In a Rare Ruling, Appeal Court Declares Ontario Judge Was Biased

Virtually anyone who has been involved in (or dragged through) litigation will get the feeling – at some point or the other – that the process is not fair.

But in an uncommon ruling in one case, that suspicion was confirmed: the Ontario Court of Appeal ruled that an experienced judge (Justice David L. Corbett) who had heard various motions in a dispute over franchise agreements, had likely been biased against one of the parties to the litigation, to the point where a new hearing had to be ordered.

In Stuart Budd & Sons Limited v. IFS Vehicle Distributors ULC, the case involved numerous plaintiffs and numerous defendants in a dispute over the alleged breach of various franchise agreements and breaches of legislation governing franchises. The Ontario judge was asked to hear and decide certain jurisdictional issues, most notably on the question of whether a single proceeding would be the best way to resolve the disputes between all the parties, and whether it was most appropriate to litigate the dispute in Ontario, or else in California.

In this context, there were several hearings to determine the proper jurisdiction and method of proceeding. However – as the Ontario Court of Appeal later confirmed – the judge through his conduct and various conduct demonstrated a clear bias towards some of the parties.

In its ruling the Appeal Court illustrated some of the mis-steps by the judge throughout the proceedings:

• He openly found fault with some of the parties and their counsel for the manner in which the motion – which he declared as being “a colossal waste of time” – was being brought. For example, at one point the judge said:

A lick of common sense should have made it clear that this motion, as framed, was doomed from the outset. So why bring it? If the honestly held belief was that this case ought to be pursued in California, all I can say to the defendants is “give your heads a shake”.

• He made various derisive comments throughout the motion hearings, and repeatedly criticized a lawyer’s advocacy skills, knowledge of the law, and the handling of the matter.

• He appeared to go out of his way to assist the opposing parties, by subtly curtailing the presentation of the case against them. For example, at various points in the proceedings he rhetorically asked counsel “what was the point?” of his line of questioning and intimated that the cross-examinations were “frustrating” and “interminably, circling around and about, in and around.”

There were other procedural irregularities which called the judge’s impartiality into question. For example:

• He adjourned a motion on his own initiative, to give some of the parties a chance to correct a flaw that he identified as being “fatal” to their position.

• He arbitrarily cut short a motion at the half-day point, even though it had been scheduled for a full day and even though some of the parties had not had a chance to give their oral arguments.

• He took nine months to release one of his rulings on the motion, and it contained after-the-fact reasoning designed to forestall arguments that he knew would be raised on a later appeal.

The evident bias did not end with the proceedings or even the ruling on the motion itself: The Judge also penalized some of the parties with $50,000 in costs, having found that their motion was so devoid of merit, and was brought in so time-consuming, expensive and impractical a manner, that elevated costs were appropriate.

In the end, and after reviewing the proceedings and considering the cumulative effect of the judge’s improprieties, the Appeal Court arrived at an uncommon conclusion that judicial bias and lack of impartiality had been evident. As the Court wrote:

I have no doubt that the motion judge was well-intentioned. I have no doubt that he put a great deal of effort into resolving the jurisdiction issue. However, my review of the three endorsements leads me to conclude that the motion judge’s actions gave rise to a reasonable apprehension of bias. He made unwarranted negative comments about the appellants – their counsel, their position, and their arguments – prior to the conclusion of argument and arbitrarily curtailed argument. He then wrote reasons that went beyond reflecting the reasoning process and entered the fray as an advocate for his actions and decisions in the Second Endorsement.

In my opinion, the cumulative effect of the motion judge’s conduct is that an informed, reasonable observer, viewing the proceedings as a whole, would conclude that the appellants did not receive the fair hearing to which they were entitled.

I am therefore of the view that the decision must be set aside.

For the full text of the decision, see:

Stuart Budd & Sons Limited v. IFS Vehicle Distributors ULC, 2016 ONCA 60 (CanLII)

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