



COURT OF APPEAL FOR ONTARIO

CITATION: IAP Claimant H-15019 v.
    Wallbridge, 2020 ONCA 270

DATE: 20200428

DOCKET: C66737

Simmons, Pepall and Trotter
    JJ.A.

BETWEEN

IAP Claimant H-15019

Respondent (Plaintiff)

and

P. James Wallbridge
, Lindsy McNicoll,
Wallbridge, Wallbridge

and
    The Attorney General of Canada

Appellants
(Defendants)

Geoffrey D.E. Adair, Q.C., for the
    appellants

W. Cory Wanless, for the respondents

Catherine A. Coughlan, for the Attorney
    General of Canada

Heard : February 4, 2020

On appeal
    from the order of Justice Robbie D. Gordon of the Superior Court of Justice,
    dated March 13, 2019.

REASONS FOR DECISION

[1]

The main issue on appeal is whether the motion
    judge erred in dismissing a motion brought by the appellant lawyers under r.
    21.01(3)(d) of the
Rules of Civil Procedure
, R.R.O. 1990, Reg. 194, to
    dismiss the respondent's action against them as frivolous and vexatious and an
    abuse of process. On the motion, the appellants asserted that the respondents action
    was barred by a release and cause of action bar contained in a settlement agreement
    approval order. The motion judge found that the respondents action is not
    barred and dismissed the motion. For the reasons that follow, we dismiss the
    appeal.

Background

[2]

The respondent is a member of Fort Albany First
    Nation and a survivor of St. Anne's Indian Residential School. He is also a
    class member of one of the Indian Residential Schools Survivors Class Actions
    that was settled subject to court approval in May 2006 by the Indian
    Residential Schools Settlement Agreement (the IRSSA). The IRSSA was approved by
    court order dated December 15, 2006 (the Settlement Approval Order). Among
    other things, the IRSSA established the Independent Assessment Process (IAP) as
    a modified adjudicative process for addressing claims and awarding compensation
    arising from physical, sexual or psychological abuse suffered by Indian
    Residential School survivors:
Fontaine v. Canada (Attorney General)
,
    2017 ONSC 2487, at para. 57.

[3]

The respondent retained the appellant lawyers in
    2009 to bring an IAP claim on his behalf. His initial claim was dismissed, as
    was a subsequent review, because his evidence was found not sufficiently
    reliable to meet the burden of proof. Eventually, the respondent retained a new
    lawyer who obtained a new hearing that resulted in a July 18, 2017 award
    granting the respondent significant compensation for what was found to be repeated
    serious abuse.

[4]

On August 31, 2017 the respondent commenced an
    action against the appellants, another lawyer, and The Attorney General of Canada
    (Canada) for psychological harm he claims he suffered, not because of his
    mistreatment at St. Anne's, but rather as the result of:  being
    disbelieved, the initial dismissals of his IAP claim and review, and having to
    undergo a further hearing. As against the lawyers, the respondents action is
    based on breach of contract, breach of fiduciary duty and negligence. As
    against Canada, the respondents action alleges breaches of Canadas
    obligations under the IRSSA, the Settlement Approval Order and related orders
    to disclose documents and compile reports relating to St. Annes prior to his
    initial IAP hearing and review that were relevant to his IAP claim.

[5]

The Settlement Approval Order contained a
    release and cause of action bar in favour of the Indian Residential Schools
    Class action defendants and other released organizations (collectively the
    Class Action Defendants). Under paragraph 15 of the Settlement Order, Indian
    Residential Schools Class Action class members (the Class Members) released the
    Class Action Defendants, including Canada, from claims in relation to an
    Indian Residential School or the operation generally of Indian Residential
    Schools (the paragraph 15 release).

[6]

Paragraph 19 of the Settlement Order barred Class
    Members from commencing proceedings that might give rise to claims for
    contribution and indemnity or similar relief against Class Action Defendants in
    relation to the released claims (the paragraph 19 cause of action bar).

[7]

Relying on the paragraph 15 release and the paragraph
    19 cause of action bar, the appellants moved to have the respondents action
    against them dismissed as frivolous and vexatious and an abuse of process. As
    of the date of the motion, the appellants had not sought contribution or
    indemnity from Canada. However, pleadings had not closed and the appellants
    relied on the language of the paragraph 19 cause of action bar precluding
    proceedings against any person who might claim contribution and indemnity
    against the Class Action Defendants.

[8]

In a motion heard the same day, Canada moved to
    have the action dismissed as an abuse of process based on the paragraph 15
    release (the Canada motion).
[1]
In addition, Canada argued that the issues in the action against it had already
    been litigated as part of the respondents IAP proceeding. In the alternative,
    Canada asked that the action against it be stayed pending application to the
    Eastern Administrative Judge under the Court Administration Protocol to the
    Settlement Order. Canada asserted that under the terms of the Settlement Order,
    the respondent required leave to commence the action and, in any event, the
    action had to be initiated by a Request for Directions as it involved
    implementation or enforcement of the IRSSA.

[9]

In separate reasons released on the respective
    motions, the motion judge determined that the respondents action against
    Canada is not barred by the paragraph 15 release. However, in his reasons on
    the Canada motion, he stayed the respondents action against Canada pending
    further order of the Eastern Administrative Judge. The motion judge found the
    action against Canada involved implementation and enforcement of the IRSSA and
    therefore should have been initiated by a Request for Directions.

[10]

In his reasons on the appellants motion, the
    motion judge also found  that the respondents claim against the appellants is
    not barred by the paragraph 19 cause of action bar and dismissed the
    appellants motion for a dismissal of the action as against them.

[11]

The appellants appeal from the motion judges
    order dismissing their motion. Canada has not appealed from the motion judges
    order made on the Canada motion, nor has the formal order relating to its
    motion been taken out. Although counsel for Canada appeared at the oral hearing
    of this appeal and responded to questions from the panel, Canada did not file a
    factum and took the position it was not a party to the appeal.

The Paragraph 15 Release and Paragraph 19
    Cause of Action Bar

[12]

As paragraphs 15 and 19 of the Settlement
    Approval Order are central to the issue on appeal, we set them out in full. The
    paragraph 15 release reads as follows:

THIS COURT ORDERS
    AND DECLARES that, subject to the provisions of the Agreement, and in
    particular, section 4.06 thereof,
each Class Member
and his or her
    heirs, personal representatives and assigns or their past and present agents,
    representatives, executors, administrators, predecessors, successors,
    transferees and assigns,
have released and shall be conclusively deemed to
    have fully, finally and forever released the Defendants
and the Other
    Released Church Organizations and each of their respective past and present
    parents, subsidiaries and related or affiliated entities and their respective
    employees, agents, officers, directors, shareholders, partners, principals,
    members, attorneys, insurers, subrogees, representatives, executors,
    administrators, predecessor, successors, heirs, transferees and assigns
from
    any and all actions, causes of action, common law and statutory liabilities,
    contracts, claims and demands of every nature or kind available, asserted or
    which could have been asserted whether known or unknown including for damages,
    contribution, indemnity, costs, expenses and interest which they ever had, now
    have or may have hereafter have [
sic
], directly or indirectly or any way
    relating to or arising directly or indirectly
by way of any subrogated or
    assigned right or otherwise
in relation to an Indian Residential School or
    the operation generally of Indian Residential Schools
and
this release
    includes any such claim made or that could have been made in any proceeding
    including the Class Actions
and including claims that belong to the Class
    Member personally, whether asserted directly by the Class member or by any
    other person, group or legal entity on behalf of or as a representative for the
    Class Member. [Emphasis added.]

[13]

The paragraph 19 cause of action bar reads as
    follows:

THIS COURT ORDERS
    AND DECLARES that
each Class Member
and each of his or her respective
    heirs, executors, administrators, personal representatives, agents, subrogees,
    insurers, successors and assigns
shall not make any claim or take any
    proceeding against any person or corporation, including the Crown, in
    connection with or related to the claims released pursuant to paragraph 15 of
    this judgment, who might claim or take a proceeding against the Defendants
or Other Released Church Organizations, in any manner or forum,
for
    contribution or indemnity or any other relief at common law or in equity or
    under any other federal, provincial or territorial statute or the applicable rules
    of court
. A Class Member who makes any claim or takes any proceeding that
    is subject to this paragraph shall immediately discontinue such claim or
    proceeding and this paragraph shall operate conclusively as a bar to any such
    action or proceeding.

The Motion Judges Reasons on the Appellants
    Motion

[14]

In his reasons on the appellants motion, the
    motion judge found that it is clear from the nature of the allegations against
    [the appellants] and Canada that [the appellants] might claim contribution or
    indemnity from Canada. However, he concluded that the respondents action was
    not barred by the Settlement Approval Order essentially for two reasons.

[15]

First, although the language of the paragraph 15
    release was broad and general, in the motion judges view, causes of action and
    damages were treated differently. While the release specifically included
    future damages, it did not include causes of action arising in the future. He
    said:

The release at paragraph 15 of the Approval
    Order, when speaking to causes of action, provides for the release of any and
    all actions, causes of action
asserted or which could have been asserted
whether known or unknown and this release includes any such claim
made or
    that could have been made
in any proceedings. It does not specifically
    include causes of action arising in the future.



This is to be
    contrasted with the release provisions pertaining to damages, which provide for
    the release of damageswhich they ever had, now have or may hereafter have,
    directly or indirectly. [Emphasis in the original.]

[16]

Thus, he concluded that the wording of the
    paragraph 15 release does not include causes of action which arise after the
    effective date of the release even if in some way related to an Indian
    Residential School or the operation generally of Indian Residential Schools.

[17]

Second, the motion judge held that even if he
    was incorrect in his interpretation of the language of paragraphs 15 and 19, a
    release of claims for solicitor negligence in the prosecution of IAP claims could
    not reasonably have been within the contemplation of the parties when the IRSSA
    was made. In reaching this conclusion the motion judge adopted language from
    the respondents factum:

It is
    inconceivable that in 2006, in the context of settling a class action brought
    by Indian Residential survivors against those who established and operated
    Indian Residential Schools  for the various abuses and harms suffered by the
    survivors when they were students at these schools [the parties] intended to
    draft a release that provides total and blanket immunity to future IAP claimant
    lawyers for malpractice claims that would deprive survivors from their right to
    sue their IAP lawyers

The Appellants Position on Appeal

[18]

On appeal, the appellants acknowledge that the motion
    judge correctly set out the principles that apply to the interpretation of a
    release. Nonetheless they assert he made extricable errors of law and a
    palpable and overriding error of fact in his interpretation.

[19]

First, the appellants say the motion judge erred
    by failing to consider the words of paragraph 15 in the context of the factual
    matrix, namely, the IRSSA, which led to the Settlement Approval Order.

[20]

The appellants point to several provisions of
    the IRSSA, which they say make it clear that the parties intended to release
    the Class Action Defendants not only from existing causes of action, but also
    from any causes of action arising in the future in any way arising in relation
    to an Indian Residential School or the operation of Indian Residential Schools,
    whether directly or indirectly. This, they say, clearly evidences an intent to
    release the respondents claim against Canada.

[21]

For example, the appellants point to the following
    language in the preamble of the IRSSA which they say patently contemplates a
    release of future causes of action:

the Parties
    agree that all actions, causes of action
,
    liabilities, claims and demands whatsoever
of every nature or kind
for
    damages, contribution, indemnity, costs, expenses and interest
which any
    Class Member  ever had, now has or may hereafter have arising in relation to
    an Indian Residential School or the operation of Indian Residential Schools 
    will be finally settled
and the Releasees will have no further liability
    except as set out in this Agreement. [Emphasis added.]

[22]

Similarly, Article 4.06 (d) reads as follows:

4.06 Approval orders will be sought:



(d) ordering and
declaring
    that  all class members  have released each of the defendants  from any and
    all actions they have, may have had or in the future may acquire
against
    any of the defendants
arising in relation to
an Indian Residential
    School or the operation of Indian Residential Schools. [Emphasis added.]

[23]

Further, Article 11.01(1)(a) stipulates:

11.01(1) The Approval Orders will declare that
    in the case of Class members

Each Class
    Member  has fully, finally and forever released
each of the Releasees f
rom any and all actions, causes of action
claims and demands
of every nature or kind available, asserted or which
    could have been asserted whether known or unknown
including for damages,
    contribution, indemnity, costs, expenses and interest
which any Class Member
     ever had, now has, or may hereafter have
, directly or indirectly arising
    from or in any way relating to  an Indian Residential School or the operation
    of Indian Residential Schools  [Emphasis added.]

[24]

By failing to consider these provisions when
    interpreting the paragraph 15 release, the appellants say the motion judge
    committed an extricable error of law.

[25]

Second, the appellants say the motion judge erred
    in failing to consider the whole of the wording of paragraph 15 when
    interpreting it. In particular, they say the motion judge erred in failing to
    take account of the words contribution and indemnity in paragraph 15. Those
    words they say make it clear that the future claims intended to be released by
    the phrase "including for damages, contribution, indemnity  which they
    ever had, now have or may have hereafter have [
sic
] were not limited to
    claims for damages. Rather they modified the earlier phrase "cause of
    action". Read as a whole, the wording of the release makes it clear that
    post-agreement causes of action against Canada, such as the respondents claim
    against Canada, were intended to be released.

[26]

Finally, the appellants argue that the motion
    judge erred in considering whether a solicitors negligence claim was within
    the contemplation of the parties when the Settlement Approval Order was made.
    As the paragraph 19 cause of action bar is derivative of the paragraph 15
    release, they say the only relevant claim for consideration is the claim
    against Canada. In relation to that claim, they argue that the Settlement
    Approval Order implemented the IRSSA, which documented a complex settlement
    that unequivocally released all claims, including claims arising post-IRSSA,
    whether arising directly or indirectly out of Indian Residential Schools  all
    in exchange for a comprehensive compensation process funded by Canada.

[27]

Particularly in light of the oversight levels,
    such as the Request for Directions process that resulted in an order for Canada
    to produce documents, the appellants say there is no basis for concluding that
    a breach of duty or slip by Canada in performing its obligations under the
    IRSSA was not within the contemplation of the parties. In any event, what was
    within the contemplation of the parties must turn on the language of the IRSSA
    and Settlement Approval Order within the context of the factual matrix. Here
    they say there is no basis for concluding the claim against Canada was not
    within the contemplation of the parties.

Discussion

[28]

As we have said, the appellants acknowledge that
    the motion judge correctly set out the principles applicable to interpreting a
    release. The motion judge relied on this courts decision in
Biancaniello v.
    DMCT LLP
, 2017 ONCA 386, 138 O.R. (3d) 210, to summarize those principles.

[29]

As acknowledged by this court, the guiding
    principle was set out in
London and South Western Railway v. Blackmore
(1870), L.R. 4 H.L. 610: The general words in a release are limited always to
    the thing or those things which were specifically in the contemplation of the
    parties at the time the release was given.

[30]

In
Biancaniello
, this court set out five
    principles for determining what was in the contemplation of the parties when
    interpreting a broadly worded release:

1.

One looks first to the language of the release
    to find its meaning.

2.

Parties may use language that releases every
    claim that arises, including unknown claims. However, courts will require clear
    language to infer that a party intended to release claims of which it was
    unaware.

3.

General language in a release will be limited to
    the thing or things that were specifically in the contemplation of the parties
    when the release was given.

4.

When a release is given as part of the
    settlement of a claim, the parties want to wipe the slate clean between them.

5.

One can look at the circumstances surrounding the giving of the
    release to determine what was specially in the contemplation of the parties.

[31]

In his related reasons on the Canada motion, apart
    from his conclusion that the paragraph 15 release did not release claims for
    factual situations that had not yet occurred, the motion judge gave one further
    reason for saying the respondents claim against Canada was not barred by the
    paragraph 15 release.

[32]

At para. 22 of his reasons on the Canada motion,
    the motion judge opined that it could not have been the intention of the
    parties to release Canada from obligations it was assuming under the IRSSA. He
    said:

Even if I am
    incorrect in this interpretation of the release provisions,
it is my view
    that the release of all claims relating to compliance by Canada of its
    obligations under the IRSSA could not reasonably have been in the contemplation
    of the parties
. Surely,
claimants cannot, by the same agreement that
    imposes obligations on Canada, be taken to have released it from those very
    obligations
. [Emphasis added.]

[33]

We agree with the motions judge that compliance
    by Canada of its obligations under the IRSSA would not be encompassed by the
    release. This conclusion is dispositive of this appeal.

[34]

For ease of reference, we repeat the central
    language of the paragraph 15 release:

THIS COURT ORDERS AND DECLARES that, subject to the provisions of
    the Agreement, and in particular, section 4.06 thereof,
each Class Member
and his or her heirs, personal representatives and assigns
have released
    and shall be conclusively deemed to have fully, finally and forever released
    the Defendants

from any and all actions, causes of action,
common
    law and statutory liabilities, contracts, claims and demands of every nature or
    kind available,
asserted or which could have been asserted whether known or
    unknown
including for damages, contribution, indemnity, costs, expenses and
    interest
which they ever had, now have or may have hereafter have [
sic
],
    directly or indirectly or any way relating to or arising directly or indirectly
by way of any subrogated or assigned right or otherwise
in relation to an
    Indian Residential School or the operation generally of Indian Residential
    Schools
and this release includes any such claim made or that could have
    been made in any proceeding including the Class Actions


[35]

The language is undoubtedly broad. That said,
    the key concept is that the claims released are those arising directly or
    indirectly  in relation to an Indian Residential School or the operation
    generally of Indian Residential Schools. Here the respondents claim against
    Canada is not a claim in relation to an Indian Residential School or the
    operation of Indian Residential Schools, either directly or indirectly. Rather,
    it is a claim for psychological harm suffered by the respondent because his
    evidence was adjudged insufficiently reliable to meet the burden of proof in an
    alternative adjudicative process as a result of Canadas alleged failure to satisfy
    its disclosure obligations under the IRSSA.

[36]

As the motion judge said, it cannot have been
    within the reasonable contemplation of the parties that Class Members would
    give up any rights they could have arising from Canadas failure to fulfill its
    obligations under the IRSSA or the Settlement Approval Order.

[37]

Based on the foregoing reasons, we conclude that
    the respondents claim against Canada is not barred by the paragraph 15
    release, and, as a corollary to that conclusion, that the respondents claim
    against the appellants is not barred by the paragraph 19 cause of action bar.

[38]

During the appeal hearing, the panel raised questions
    about the motion judges finding in the Canada motion that the respondents
    claim against Canada is not barred by the paragraph 15 release, in particular, whether
    that finding is final for the purpose of the respondents action against Canada,
    and the impact, if any, of that finding and Canadas failure to appeal that
    finding on this appeal.

[39]

The parties did not agree on whether that
    finding is final for the purpose of the respondents action against Canada.
    Assuming the finding is final, we have reached the same conclusion as the
    motion judge in any event. Even if the finding is not final, as a party to the
    same proceeding, Canada attended but chose not to seek the right to participate
    in this appeal.

[40]

Finally, we note that the parties did not
    address whether the absence of privity of contract would prevent the appellants
    from relying on the release and cause of action bar:
Van Patter v.
    Tillsonburg District Memorial Hospital
(1999), 45 O.R. (3d) 223 (C.A.);
Owen
    v. Zosky
, [2000] O.J. 4838 (C.A.);
Fraser River Pile & Dredge Ltd.
    v. Can-Dive Services Ltd.
, [1999] 3 S.C.R. 108. Nothing in these reasons
    should be taken as commenting on that issue. Nor of course do we comment on the
    merits of the respondents action against the appellants or Canada.

Disposition

[41]

Based on the foregoing reasons, the appeal is
    dismissed with costs to the respondent on a partial indemnity scale in the
    agreed upon amount of $10,000 inclusive of disbursements and applicable taxes.

Janet
    Simmons J.A.

S.E.
    Pepall J.A.

Gary
    Trotter J.A.





[1]

The respondent filed a copy of the motion judges reasons on
    the Canada motion in a respondents compendium. However, the Canada motion
    record was not before us and we have discerned the relief sought based only on
    the motion judges reasons.


