



COURT OF APPEAL FOR ONTARIO

CITATION: Waldman v. Thomson Reuters Canada Limited, 2015
    ONCA 53

DATE: 20150128

DOCKET: C58585

Simmons, MacFarland and Benotto JJ.A.

BETWEEN

Lorne Waldman

Plaintiff (Appellant)

and

Thomson Reuters Canada Limited

Defendant (Respondent)

Paul J. Pape and Shantona Chaudhury, for the appellant

Andrew E. Bernstein and Sarah Whitmore, for the
    respondent

Heard:  November 18, 2014

On
    appeal from the order of Justice Paul M. Perell of the Superior Court of
    Justice, dated March 4, 2014, with reasons reported at 2014 ONSC 1288.

MacFarland J.A.:

[1]

On October 3, 2013, the appellant and the respondent reached an
    agreement to settle a copyright infringement class action. By order dated March
    4, 2014, Perell J. refused to approve the settlement, as well as the retainer
    agreement and class counsel fees sought as part of that agreement. The
    appellant, supported by the respondent, appeals that refusal to this court.

[2]

Prior to the hearing of the appeal, this court, through its senior legal
    officer, raised with counsel the question of whether this court has
    jurisdiction to hear the appeal. Counsel were asked to address whether the
    appeal properly lay to this court or to the Divisional Court with leave.

[3]

It is of note that both the appellant and the respondent are allied in
    interest on this appeal and there is no party
contra
. Prior to the
    hearing on the issue of jurisdiction, counsel were informed that, should the
    court conclude the appeal was properly before this court, the hearing of the
    appeal on the merits would be adjourned to permit the appointment of
amicus
.

Background

[4]

The nature of the proceeding, the terms of the settlement
    agreement and the motion judges disposition are all succinctly set out in the
    first eight paragraphs of his reasons as follows:

[1]      In this certified class action under the
Class
    Proceedings Act, 1992
, S.O. 1992, c. 6 [(
CPA
)], the
    Representative Plaintiff, Lorne Waldman, moves for approval of a settlement of
    a copyright infringement class action against Thomson Reuters Canada Limited (Thomson).

[2]      The action was commenced because Thomson, through its
    legal publishing branch known as Carswell, makes available court documents
    authored by the lawyers who constitute the Class Members. Carswell copies
    documents from public court files, replicates them on an electronic database
    and search and retrieval service known as Litigator, and makes the copies
    available to subscribers. Documents authored by Mr. Waldman, who is a lawyer,
    were included in Litigator without his permission.

[3]      In the class action, Mr. Waldman alleges that Thomson
    infringes the copyright of the Class Members under the
Canadian Copyright
    Act
, R.S.C. 1985, c. C-42 by making available, without permission and for
    a fee, copies of court documents authored by Class Members and their law firms.

[4]      Subject to court approval, Mr. Waldman and Thomson
    have signed a Settlement Agreement. Under the Agreement, Thomson settles a
    $350,000 cy-près trust fund to support public interest litigation. Thomson also
    agrees to make changes to the copyright notices on Litigator and to the terms
    of its contract with subscribers. The individual Class Members, who may
    opt-out, receive no monetary award under the Settlement Agreement, and they
    sign a release and grant a non-exclusive license of their copyrights in the
    court documents to Thomson.

[5]      Class Counsel, Sack Goldblatt Mitchell LLP, which was
    assisted by Deeth Williams Wall LLP in regard to copyright law, moves for
    approval of its contingent fee agreement with Mr. Waldman and for court
    approval of counsel fees of $825,000, all inclusive. Class Counsels fee is
    paid as a term of the proposed Settlement Agreement.

[6]      The proposed settlement is supported by, among others,
    Mr. Waldman, Class Counsel, a blue-ribbon group of lawyers who are prepared to
    be trustees for the cy-près trust fund, several Canadian law schools, the
    Canadian Bar Association, the Canadian Civil Liberties Association, and the
    British Columbia Civil Liberties Association.

[7]      After a thorough notice program, the Settlement
    Agreement is opposed by seven Class Members.

[8]      For the reasons that follow, I conclude that the
    proposed Settlement is not fair, reasonable, and in the best interests of the
    Class Members. I, therefore, dismiss the motions for settlement and fee
    approval.

Analysis

[5]

Section 29(2) of the
Class Proceedings Act, 1992
, S.O. 1992, c. 6 (
CPA
)
provides that a settlement of a class
    proceeding is not binding unless approved by the court. The
CPA
does
    not address the appeal route from an order refusing to approve a settlement
    agreement. Accordingly, the
Courts of Justice Act
, R.S.O. 1990, c.
    C.43

(
CJA
) governs the appeal route in this case: see
Locking
    v. Armtec Infrastructure Inc.
, 2012 ONCA 774, 299 O.A.C. 20, at para. 11.

[6]

Section 6(1)(b) of the
CJA
provides that:

An appeal lies to the Court of Appeal from  a final order of a
    judge of the Superior Court of Justice, except an order referred to in clause
    19(1)(a) or an order from which an appeal lies to the Divisional Court under
    another Act.

[7]

The preliminary issue in determining the jurisdiction of this court is
    therefore whether the order appealed from is final or interlocutory. If the
    order is final, this court has jurisdiction over the matter, subject to certain
    exceptions outlined in s. 19(1)(a) of the
CJA
or the provisions of
    another Act. If the order is interlocutory, then this court has no jurisdiction
    and an appeal lies to the Divisional Court with leave, pursuant to s. 19(1)(b)
    of the
CJA
.

[8]

The question of whether an order is final or interlocutory is one that
    has vexed courts for years. Courts asked to consider this issue often begin
    with the observation of Middleton J.A. in
Hendrickson v. Kallio
,
    [1932] O.R. 675 (C.A.), at p. 678:

The interlocutory order from which there is no appeal is an
    order which does not determine the real matter in dispute between the parties 
    the very subject matter of the litigation, but only some matter collateral. It
    may be final in the sense that it determines the very question raised by the
    application, but it is interlocutory if the merits of the case remain to be
    determined.

[9]

The appellant asserts that the order which is the subject of this appeal
    dealt with three separate matters:

1. approval of the settlement agreement;

2. approval of the fee retainer agreement; and

3. approval of the fees sought.
[1]

[10]

The
    appellant submits that this court has the jurisdiction to hear the appeal from all
    three parts of the order. There are two prongs to the appellants argument.
    First, he submits that the motion judges refusal to approve the settlement
    agreement was a final order. Second, he submits that, even if the motion judges
    refusal to approve the settlement was an interlocutory order, his refusal to
    approve the fee agreements and the amount of fees sought was a final order, and
    this court therefore has jurisdiction to review the entire order pursuant to s.
    6(2) of the
CJA
.

[11]

Section
    6(2) of the
CJA
provides that
:

The Court of Appeal has jurisdiction to hear and determine an
    appeal that lies to the Divisional Court or the Superior Court of Justice if an
    appeal in the same proceeding lies to and is taken to the Court of Appeal.

[12]

I
    shall begin by addressing the second part of this argument.

[13]

The appellant submits that this court has previously determined
    that appeals in relation to the approval of fee retainer agreements and fees
    lie to this court. In this respect he relies on this courts decision in
Sutts,
    Strosberg LLP v. Atlas Cold Storage Holdings Inc.
, 2009 ONCA 690, 311
    D.L.R. (4th) 323
.

[14]

I
    cannot agree that
Sutts, Strosberg

stands for the proposition
    that all appeals from orders related to fee retainer agreements and fees lie to
    this court. In
Sutts, Strosberg
, this court did indeed refuse to quash
    an appeal from the order of a motion judge reducing the amount of fees payable
    pursuant to a settlement agreement. In
that
    case
, however, the motion judge had approved the settlement
    agreement but, in so doing, she reduced the amount of fees sought by class
    counsel. She ultimately approved both the settlement and the reduced quantum of
    fees. Her order finally determined the issues between the parties and, subject
    to an appeal, the litigation.

[15]

This
    case differs from
Sutts, Strosberg
because here there was no approval
    and therefore, in my view, no finality  here, the litigation continues.

[16]

I
    would therefore reject the appellants argument that the appeal from the
    portion of the motion judges order refusing to approve the fee agreement and the
    fees themselves is properly before this court on the basis of the
Sutts, Strosberg
decision.

[17]

Even
    if I had concluded otherwise, the appellants submission that this court would
    then have jurisdiction under s. 6(2) of the
CJA
to hear the appeal in
    respect of the entire order would still fail. An appeal from an interlocutory
    order only lies to the Divisional Court within the meaning of s. 6(2) once
    leave to appeal that order has been granted: see
Albert v. Spiegel
(1993), 17 C.P.C. (3d) 90 (Ont. C.A.), at p. 91;
Merling v. Southam Inc.
(2000), 128 O.A.C. 261, at para. 2;
Cole v. Hamilton
(2002), 60 O.R.
    (3d) 284 (C.A.), at paras. 6 and 15;
Diversitel Communications Inc. v.
    Glacier Bay Inc.

(2004), 181 O.A.C. 6 (C.A.), at para. 6. If the
    motion judges order refusing to approve the settlement agreement was interlocutory,
    then this court still would not have jurisdiction to hear the appeal from that
    order under s. 6(2) of the
CJA
unless and until the appellant obtained
    leave to appeal to the Divisional Court. Only then could the appellant bring a
    motion, under s. 6(3) of the
CJA
to transfer that appeal to this court.
    Section 6(3) of the
CJA
provides that:

The Court of Appeal may, on motion, transfer an appeal that has
    already been commenced in the Divisional Court or the Superior Court of Justice
    to the Court of Appeal for the purpose of subsection (2).

[18]

The
    appellant, supported by the respondent, argues that, in any event, an appeal
    lies to this court under s. 6(1)(b) of the
CJA
because the order
    refusing to approve the settlement agreement is a final order of a judge of the
    Superior Court. He argues that this is a final order because, although the
    litigation could continue, the settlement agreement has been finally dismissed.
    The appellant submits that, where the approval of a settlement has been
    determined, substantive rights are affected. He argues that this situation is
    therefore different from the dismissal of a motion for summary judgment, which
    typically neither finally determines an issue in the litigation nor affects substantive
    rights.

[19]

More
    specifically, the appellant argues that the settlement agreement is a contract that
    binds the parties, even if it is subject to court approval, and that the motion
    judges refusal to approve the settlement puts an end to these contractual
    rights. This, he submits, amounts to a final order. In this regard the
    appellant relies on this courts decision in
Wu Estate v. Zurich Insurance
    Co
. (2006), 211 O.A.C. 133, 268 D.L.R. (4th) 670.

[20]

In
    my view,
Wu Estate
gives no comfort to the parties. In that case, the
    order under appeal dismissed an application, brought by the deceased plaintiffs
    estate, her estate trustees, and her relatives, to enforce minutes of
    settlement. It was a final order because it finally ended the particular
    proceeding before the court: see
Buck Brothers Ltd. v. Frontenac Builders
    Ltd.
(1994), 19 O.R. (3d) 97, 73 O.A.C. 298 (C.A.). The same cannot be
    said of the motion judges order refusing to approve the settlement agreement
    in this case. That order did not end the class proceeding; rather, it requires
    the proceeding to continue.

[21]

Likewise,
    the jurisprudence dealing with appellate jurisdiction over orders made pursuant
    to rule 49.09 does not assist the parties in this case. When a judge concludes,
    on a motion under rule 49.09, that an action has not been settled, that factual
    issue is finally determined for the purposes of the litigation: see
Fusarelli
    v. Dube
, [2005] O.J. No. 4398, 2005 CanLII 37251 (C.A.);
Capital Gains
    Income Streams Corp. v. Merrill Lynch Canada Inc.
, 2007 ONCA 497, 87 O.R.
    (3d) 443, at paras. 30-31. The same cannot be said here, where court approval
    of any settlement agreement between the parties is statutorily required and a
    settlement is not binding unless and until court approval is obtained.

[22]

The
    appellants argument amounts to a claim that, because this particular settlement
    agreement cannot be reconsidered if the litigation goes forward, the order is a
    final order with respect to the agreement, and is therefore also a final order
    for the purposes of s. 6(1)(b) of the
CJA
. This submission presumes
    that, to be a final order, an order need only dispose finally of whatever issue
    was before the motion judge irrespective of whether the order terminates the action
    or resolves a substantive claim or defence of the parties. Were that so, the
    distinction between interlocutory and final orders would cease to exist. Some might
    say that would be a good thing. Still, I hearken back to the words of Middleton
    J.A. in
Hendrikson
:

... it may be final in the sense that it determines the very
    question raised by the application, but it is interlocutory if the merits of
    the case remain to be determined.

[23]

Here,
    although the settlement agreement was not approved, the litigation continues,
    and the parties cannot be said to have lost a substantive right relating to the
    merits of the litigation. The order is interlocutory and any appeal lies to the
    Divisional Court with leave.

[24]

I
    would therefore quash the appeal.

[25]

In
    the circumstances of the case where both the appellant and the respondent were
    allied in interest and argued in favour of this courts jurisdiction, I would
    order that there be no costs of the appeal.

Released: January 28, 2015
    JMacF                     J. MacFarland J.A.

I
    agree Janet Simmons J.A.

I
    agree M.L. Benotto J.A.





[1]
The order under appeal states:

1.

THIS COURT
    ORDERS that the settlement agreement dated October 3, 2013 is not approved.

2.

THIS COURT
    ORDERS that the class counsel fees sought are not approved.

3.

THIS COURT
    ORDERS that there shall be no order as to costs.

On the motion, the appellant sought approval of the
    fee retainer agreement and the approval of class counsel fees. I assume that,
    in refusing to approve the fees sought, the motion judge also effectively
    refused to approve the fee agreement. The appellant treated these two issues as
    distinct on appeal.


