



COURT
    OF APPEAL FOR ONTARIO

CITATION: Franmed Consultants (1993) Inc. v.
    Medcan Health Management Inc., 2020 ONCA 687

DATE: 20201029

DOCKET: C67989

Doherty, Paciocco and Coroza
    JJ.A.

BETWEEN

Franmed
    Consultants (1993) Inc.
, 1852421 Alberta ULC and
    Dr. Robert Francis

Plaintiffs (
Appellant
)

and

Medcan
    Health Management Inc.
, Shaun Francis, Andrew
    Carragher, Paige Francis, Edwin F. Hawken, Urban Joseph, Beau Laskey, Thomas P.
    Reeves, Owen Rogers and Craig Shepherd

Defendants (
Respondent
)

AND BETWEEN

Medcan Health Management Inc.

Plaintiff by
    Counterclaim

and

Franmed Consultants (1993) Inc.,
    Dr. Robert Francis and Leonard Goodman

Defendants by
    Counterclaim

Ronald B. Moldaver, Q.C., for the
    appellant

Fredrick R. Schumann, for the
    respondent

Heard: October 14, 2020 by
    video conference

On appeal
    from the order of Justice Barbara A. Conway of the Superior Court of Justice,
    dated January 16, 2020.

REASONS FOR DECISION

[1]

The appellant, Franmed Consultants (1993) Inc. (Franmed),
    appeals from the motion judges decision to dismiss its action against the
    respondent, Medcan Health Management Inc. (Medcan), under r. 20 of the
Rules
    of Civil Procedure
, R.R.O. 1990. Reg. 194. Franmed also applies for leave
    to appeal the motion judges costs award to Medcan in the amount of $100,000
    for the action and the motion. At the conclusion of the oral hearing, we
    dismissed the appellants appeal and application for leave to appeal costs with
    reasons to follow. These are our reasons.

[2]

Dr. Robert Francis is the owner and sole
    shareholder of Franmed. He operates a medical practice called the Chairmans
    Plan through Franmed, in a space leased by Medcan.

[3]

Dr. Francis is also the founder of Medcan. He
    controlled Medcan until 2016, when his son, Shaun Francis, acquired joint
    control of the company.

[4]

From the 1990s until 2019, Medcan made annual
    payments to Franmed. The payments increased over time and, by 2018, Medcan was
    paying Franmed $1.2 million per year. Dr. Francis claimed that these were
    payments for services that Franmed provided to Medcan.

[5]

In 2018, Medcans board of directors assembled
    an independent committee to examine the relationship between Dr. Francis,
    Franmed and Medcan. On September 12, 2018, Shaun, on behalf of the board, sent
    a letter to Dr. Francis notifying him that Medcan would pay Franmed $1.2
    million annually for two more years until September 2020, when the payments
    would cease. Dr. Francis did not accept this arrangement. By January of 2019,
    the board determined that Dr. Francis was a risk to Medcans reputation
    because of his erratic behaviour and that the payments to Franmed should be
    discontinued.

[6]

Franmed brought an action against Medcan for
    damages arising from breach of contract. Franmed argues that it had a
    longstanding contract with Medcan of indeterminate duration which required
    Medcan to make the payments it had been making to Franmed over the years.
    Franmed further argues Medcan breached the agreement when it purported to
    terminate it. Franmed submits damages are the appropriate remedy in the
    circumstances as they now exist between the parties. Franmed fixes those
    damages at the equivalent of reasonable notice were the agreement capable of
    termination. Franmed submits that seven years constitutes reasonable notice.

[7]

Medcan defended the action and issued a
    counterclaim. The actions became the subject matter of two summary judgment
    motions heard together by the motion judge. After carefully examining the evidence,
    the motion judge held that the documentary evidence did not support the
    existence of a contract or define any terms of the alleged contract. She found
    that the only reference to an oral agreement was in the September 12, 2018
    letter sent by Shaun. However, this referenced Medcans willingness to make an
    additional two years of payment to Franmed; in her view, the letter did not
    refer to or support the existence of any ongoing obligation of Medcan to make
    annual payments to Franmed. The motion judge concluded that while Medcan
    historically made payments to Franmed, there was no contract that required it
    to do so in perpetuity. Accordingly, the motion judge dismissed Franmeds
    action.

[8]

On appeal, Franmed argues that the motion
    judges conclusion that there was no contract is unreasonable. It contends that
    the documents before the motion judge, including Shauns letter of September 12,
    2018, draft term sheets used in negotiations when Medcan attempted to purchase
    the Chairmans Plan from Franmed, financial statements, and Dr. Francis
    affidavit evidence point to the existence of a contract.

[9]

We do not accept this submission. The core issue
    on the motion was whether a contract existed between Franmed and Medcan, and
    the motion judges decision is entitled to deference.

[10]

In our view, the motion judges decision rested
    on inferences and findings that were clearly open to her and reasonable on the
    evidence adduced on the motion. There is no basis to interfere with the motion
    judges conclusion that there was no contract.

[11]

The motion judges finding that there was no
    contract is fatal to Franmeds other arguments in relation to oppression and
    relief from forfeiture. These arguments are predicated on the existence of a
    contract.

[12]

Turning to Franmeds application for leave to
    appeal the costs awarded below, the motion judge made several costs orders.
    First, she awarded Medcan costs for the action and the motion in the amount of
    $100,000. Second, she ordered Franmed to pay costs in the amount of $30,000
    that were fixed by a different judge on a previous motion and made payable in
    the cause. Third, she awarded Shaun Francis costs for the action and the motion
    in the amount of $30,000. Finally, she ordered Franmed to pay costs in the
    amount of $5,000 that were agreed to between the parties in respect of a
    previous motion argued before a different judge.

[13]

Franmed seeks leave to appeal only the costs
    order of $100,000 for the action and the motion. Franmeds complaint is that
    the quantum ordered was excessive.

[14]

We see nothing in this submission, and no basis
    for disturbing the motion judges discretionary costs order.

[15]

Accordingly, we dismiss the appeal and refuse
    leave to appeal costs. Medcan is entitled to costs of the appeal fixed in the
    agreed upon amount of $8,500, inclusive of disbursements and applicable taxes.

Doherty
    J.A.

David
    M. Paciocco J.A.

S.
    Coroza J.A.


