



COURT OF APPEAL FOR ONTARIO

CITATION:
Dick v. McKinnon, 2014 ONCA 784

DATE: 20141107

DOCKET: C58362

Strathy C.J.O., Feldman and Lauwers JJ.A.

BETWEEN

Richard
    Dick,
Steve Marek by his Litigation Guardian,

David Marek
and
    John Kuca

Plaintiffs (
Appellant
)

and

Robert Duncan McKinnon, Tubular Steel Inc. and
    1086668 Ontario Inc.

Defendants (Respondents)

Daniel J. Dochylo, for the appellant

R. Jonathan McKinnon, for the respondents

Heard: October 31, 2014

On appeal from the judgment of Justice E.M. Morgan of the
    Superior Court of Justice, dated January 17, 2014 and February 7, 2014, with
    reasons reported at 2014 ONSC 342 and 2014 ONSC 917.

ENDORSEMENT

[1]

The motion judge made an order under rule 49.09 of the
Rules of
    Civil Procedure
, R.R.O. 1990, Reg. 194, enforcing a settlement made in
    2005 between the appellant and the respondents. The settlement called for the
    payment of $700,000 by the respondents in exchange for the appellants interest
    in shares of the corporate respondent, Tubular Steel Inc. The appellant resists
    enforcement of the settlement on the ground that at the time of the settlement
    in 2005 he lacked mental capacity to consent to the settlement and to instruct
    counsel.

[2]

Before the motion judge, and in this court, the appellant argued the
    issue must be addressed under rule 7.08 of the
Rules
, dealing with the
    approval of a settlement made by a person under a disability. We agree with the
    motion judge that rule 7.08 does not apply, because the appellant had not been
    found to be under a disability and no litigation guardian had been appointed.

[3]

A person who is eighteen years of age or more is presumed to be capable
    of entering into a contract:
Substitute Decisions Act, 1992
, S.O.
    1992, c. 30, s. 2(1).

[4]

This court has observed that it is well-established law that a
    solicitor of record has the ostensible authority to bind his or her clients and
    that opposing counsel are entitled to rely upon that authority in the absence
    of some indication to the contrary:
Oliveira v. Tarjay Investments Inc.
,

[2006] O.J. No. 1109, at para. 2 (C.A.), referring to
Scherer v.
    Paletta
, [1966] 2 O.R. 524 (C.A.) and
Mohammed v. York Fire and
    Casualty Insurance Co
.,

[2006] O.J. No. 547
,
    at para. 20 (C.A.).

[5]

The motion judge found the appellant had received both legal and
    accounting advice and the settlement was negotiated and finalized by his
    solicitor of record. He clearly found the appellant had not discharged the onus
    of proving:

·

that he lacked capacity;

·

that his solicitor acted without instructions;

·

that the respondents were aware of any lack of capacity or of any
    limits on the solicitors authority; or

·

that the settlement was unfair.

[6]

The motion judges conclusions on the latter two issues are dispositive
    and were open to him on the evidence. There is no basis on which we can
    interfere. We therefore dismiss the principal ground of appeal.

[7]

We do, however, allow the appeal from the disallowance of interest on
    the purchase price of the appellants shares. The respondents have had the
    benefit of the shares in the intervening years. Mr. McKinnon candidly
    acknowledged the shares had appreciated in value, a circumstance that appears
    not have been brought to the attention of the motion judge. The appellant is
    entitled to interest on the sum of $700,000 at the rate of 2.8% per annum.

[8]

In light of the divided success on the appeal, we are not inclined to
    award costs. If, however, the parties wish to make submissions, they may do so in
    writing, within 15 days.

G.R. Strathy C.J.O.

K. Feldman J.A.

P. Lauwers J.A.


