



COURT OF APPEAL FOR ONTARIO

CITATION: Stuart Budd & Sons Limited v. IFS Vehicle
    Distributors ULC, 2016 ONCA 60

DATE: 20160121

DOCKET: C58835

Weiler, Epstein and Huscroft JJ.A.

BETWEEN

Stuart Budd & Sons Limited, 290756 Alberta
    Ltd., Saab on the Queensway Ltd., 798983 Ontario Inc., 9216-0415 Quebec Inc.,
    6847781 Canada Ltd., Forbes Saab and Used Car Shop Inc., and Springman &
    Springman Limited

Plaintiffs (Respondents)

and

IFS Vehicle Distributors ULC, International Fleet
    Sales Inc., Michael Libasci and Peggy King

Defendants (Appellants)

Matthew Latella and Sarah Petersen, for the appellants

Andy Seretis, for the respondents

Heard: July 9, 2015

On appeal from the order of Justice David L. Corbett of
    the Superior Court of Justice, dated April 23, 2014 and the amended
    endorsement, dated February 3, 2015, with reasons reported at 2015 ONSC 519.

Epstein J.A.:

OVERVIEW

[1]

Three Ontario plaintiffs and five out-of-province plaintiffs (the
    respondents) sued four foreign defendants (the appellants) for breach of
    various franchise agreements and of certain provisions in two franchise
    statutes in a statement of claim issued in March 2013.

[2]

The appellants brought a motion to dismiss the proceeding for lack of
    jurisdiction. In the alternative, they asked the court to stay the matter on
    the basis of
forum non conveniens
. The appellants took the position
    that the claims should be brought in five provinces. Alternatively, if the
    claims were to proceed together in one action, the action should be heard in
    California.

[3]

The motion judge dismissed the motion. He found that there was
    jurisdiction
simpliciter
in Ontario for all claims and that a single
    proceeding would be a suitable and efficient way for the respondents to advance
    their claims.  He viewed Ontario as the most convenient forum for that single
    proceeding.

[4]

On appeal, the appellants challenge the motion judges findings and
    conclusions relating to jurisdiction
simpliciter
and
forum non
    conveniens.
They also submit that the motion judges comments and conduct
    during the course of the jurisdiction motion raise a reasonable apprehension of
    bias.

[5]

After considering the cumulative effect of the impugned actions of the
    motion judge in the context of the entire proceedings, I have regrettably come
    to the conclusion that an informed person, viewing the matter realistically and
    practically, would conclude that there was a reasonable apprehension of bias on
    the part of the motion judge.  The appeal must therefore be allowed and a
    new hearing ordered.

BACKGROUND FACTS

[6]

The corporate appellants, IFS Vehicle Distributors UFC (IFS) and International
    Fleet Sales Inc. (Fleet Sales) are affiliated companies. IFS is a franchisor
    and supplier of the Saab dealership network in Canada.  Fleet Sales supplies
    Saab parts and accessories to IFS. The appellant, Michael Libasci, is the President
    of IFS and the President and Chief Executive Officer of Fleet Sales. The
    appellant, Peggy King, was the Secretary and Treasurer of IFS and the Chief
    Financial Officer of Fleet Sales.  She is now retired.  Both individual appellants
    lived in California at the material time.

[7]

The respondents are all new and used Saab car dealers.  Five are not
    resident in Ontario  290756 Alberta Ltd., 9216-0415 Quebec Inc., 6847781
    Canada Ltd., Forbes Saab and Used Car Shop Inc., and Springman & Springman
    Limited.  The other three  Stuart Budd & Sons Limited, Saab on the Queensway
    Ltd. and 798983 Ontario Inc.  are Ontario corporations.

[8]

Before 2009, General Motors and its affiliates sold Saab automobiles in
    Canada.  In 2009, GM restructured its North American operations.  As part of
    that restructuring, GM stopped selling Saab automobiles and terminated its
    business with all of its Canadian Saab dealers.

[9]

A Swedish company, Saab Automobile AB (Saab AB), acquired the Saab
    brand from GM and sought to enter the Canadian market in 2010.  Saab AB approached
    Fleet Sales to help import and distribute Saab motor-vehicles from Sweden and
    Saab parts from the United States into Canada.  To this end, in June 2010, IFS was
    incorporated as an affiliate of Fleet Sales in British Columbia.

[10]

IFS
    conducted independent contract negotiations with each of the respondents about their
    again becoming Saab dealers. Ultimately, IFS executed eight separate dealer
    agreements during an eight-day period.

[11]

These
    agreements established, among other things, the terms under which the dealers
    would order cars and parts from IFS. Each contract had a choice of law clause that
    referred to the law of Ontario and the law of the jurisdiction where the dealer
    was resident. None of the agreements contained a choice of forum clause.

[12]

In
    his reasons, the motion judge summarized the relevant facts pertaining to IFSs
    operation. This unchallenged summary is as follows:

[27] IFS is a Canadian company, incorporated in and thus
    resident in British Columbia.  It was also registered to do business in
    Ontario.  There is no evidence that it was registered to do business in
    Michigan or California.

[28] IFSs Registered Address is in British Columbia.  Its
    Ontario Address was identified by it as its principal place of business, and
    was its mailing address.

[29] IFS contracted with Saab AB to distribute Saab new cars
    and parts in Canada.  It established a dealer network in Canada by contracting
    with eight former Saab dealers in five provinces of Canada.  The dealership
    agreements were signed at each of the Canadian dealerships.

[30] IFS imported cars and parts into Canada and sold them to
    its dealers.  It sent invoices showing its Ontario Address.  It established
    bank accounts in Canada and received payments here by electronic transfer or by
    cheque to a lockbox in Toronto.

[31] I find that IFSs business was in Canada and not in
    Michigan or California.

THE PROCEEDINGS

The First Hearing

[13]

On
    May 22, 2013, the parties attended motion scheduling court to secure a date for
    the appellants motion challenging Ontarios jurisdiction over the action. The
    first mutually available date was March 27, 2014. That date was approved for a
    motion estimated to take one day. A timetable for the preparation of the motion
    was established.

[14]

The
    parties exchanged affidavits.  The respondents filed only one affidavit.  It
    was sworn by Mr. Budd, the principal of the respondent Stuart Budd & Sons
    Limited, on behalf of his dealership and the other seven dealers. The
    appellants contested the respondents evidence on the grounds that it was
    extensively based on information provided to Mr. Budd by others, without his
    having identified the source of his information and setting out why he believed
    the information to be true.

[15]

On
    March 27, 2014, the motion came before Corbett J., who agreed that the respondents
    evidence was improper. In his view, the respondents framing of the evidence would
    be fatal to their position on the motion. He therefore adjourned the motion on
    his own initiative and ordered the respondents to serve a further affidavit
    from Mr. Budd.

[16]

The
    motion judge established a timetable for the return of the motion and set the
    matter for a full-day hearing before him on April 23, 2014.  He also expressed
    his view that the case cries out for case management and consequently
    directed appellants counsel to contact the team leader for case management.

[17]

In
    his endorsement adjourning the motion (the First Endorsement), the motion
    judge made a number of comments that he referred to as his preliminary, yet
    strongly held views, including:

[I]t seems plain that there is jurisdiction
simpliciter
in Ontario over the claims brought by the Ontario plaintiffs. But for having
    their claims joined with those of the Ontario plaintiffs, there seems no reason
    for the non-Ontario plaintiffs to pursue claims in Ontario.

Thus it appears that the principal arguments on the motion will
    concern the effect of joinder on jurisdiction, and issues of
forum non
    conveniens.

I also indicated to counsel that I do not anticipate that cross[-]examination
    of representatives of each of the plaintiffs will add materially to the factual
    background in which these issues arise. However, it may be that something will
    be added, and I will not second guess counsel's choice to cross[-]examine,
    given the significance of the issues.

[18]

The
    respondents delivered a further affidavit from Mr. Budd plus an affidavit sworn
    by an individual on behalf of each of the seven other respondents. 
    Cross-examinations on the affidavits were held.  At the request of Corbett J.,
    further factums were filed to address the new evidence and to make submissions
    on the specific issues of joinder, jurisdiction, and
forum non conveniens
.

The Second Hearing

[19]

On
    April 23, 2014, the parties returned before Corbett J. to argue the motion. 
    Prior to the lunch break and before hearing argument on joinder and
forum
    non conveniens
, the motion judge rendered his decision dismissing the
    appellants motion and referring to it as an abuse of process (the Second
    Endorsement).

[20]

In
    his brief reasons, the motion judge noted IFSs activities in various parts of
    Canada and found that IFSs presence in Ontario went well beyond the virtual
    presence discussed in the seminal case on jurisdiction,
Club Resorts Ltd.
    v.
Van Breda
, 2012 SCC 17, [2012] 1 S.C.R. 572, at para. 87. He concluded
    that there had to be a place in Canada where the respondents could call the
    appellants to account and that that place was Ontario.

[21]

After
    expressing this conclusion, the motion judge advised that he would be
    delivering further reasons for the purposes of any appeal of this decision. He
    established a tight time schedule for the progress of the action, concerned
    that the motion had been pursued on an unreasonable basis and at excessive
    cost in terms of time and delay.  The motion judge concluded the Second
    Endorsement by indicating that complying with the terms of his order would not
    constitute attornment to the Ontario court for the purposes of any appeal.

Appeal and Motion for a Stay

[22]

On
    May 22, 2014, the appellants served a notice of appeal from the motion judges
    decision and moved for a stay pending appeal. On July 14, 2014, this court
    granted the requested stay, holding that the proposed appeal raised several
    serious issues, namely, the intersection of jurisdictional issues and joinder,
    the motion judges failure to address the defendants other than IFS in his
    jurisdiction analysis, and the motion judges comments that may suggest
    pre-determination of the issues:
Stuart Budd & Sons Limited v. IFS
    Vehicle Distributors
, 2014 ONCA 546, 122 O.R. (3d) 472, at paras. 24-25.

THE REASONS

[23]

The
    motion judge released his reasons for appeal purposes, entitled Amended
    Endorsement on February 3, 2015, over nine months later.

[24]

At
    the outset of his analysis, the motion judge found there to be no argument
    that Ontario lacks jurisdiction
simpliciter
over the claims asserted
    by the three Ontario respondents against IFS.  He then turned to the claims of
    the non-Ontario respondents.

[25]

In
    response to the motion judges inquiries, the appellants identified two
    alternatives that, in their view, would avoid the jurisdictional problems
    created by a single action in Ontario:

a. proceedings commenced by each of the plaintiffs in their
    respective provinces;

b. a proceeding commenced by all of the currently named
    plaintiffs against all of the defendants before the courts of California.

[26]

From
    this response, the motion judge drew the following conclusions.  First, there
    is jurisdiction
simpliciter
in each of the provinces where IFS
    established a Saab dealership within the province. Second, the respondents did
    not object to joinder of their claims.  Third, the respondents position was
    that there is nowhere in Canada that IFS may be sued by its Canadian dealers,
    in one proceeding.

[27]

The
    motion judge saw no connection between the claims against IFS and California,
    other than that the two individual appellants lived in California and its
    affiliate, Fleet Sales, was incorporated there.

Jurisdiction
Simpliciter


[28]

Based
    on the reasoning set out in the following paragraphs, the motion judge found
    that IFS carried on business in each of the provinces where it had a dealership
    network and that it had its strongest presence in Ontario:

[43] When IFS entered into a dealership agreement within a
    province, it carried on business within that province, as a franchisor
    creating a network of Canadian dealers to sell Saab products in Canada.  The
    goal was to create a national network of dealers.  On this basis I conclude
    that factor b. of the
Van Breda
analysis is made out for all of the
    plaintiffs in each of the provinces where IFS had a dealer: that is, I find
    that IFS carried on business and had a substantial connection to each of the
    provinces in which it had a dealer.



[48] If I am wrong in that conclusion [that the plaintiffs
    claims are closely enough related to give rise to a substantial connection to
    any jurisdiction in which any one of the claims could be brought], I find that
    IFS had its strongest presence in Ontario.  Three of its eight dealers were
    located in Ontario.  Its mailing address is in Ontario.  It is registered to do
    business in Ontario.  Its bank accounts are in Ontario.  Its address on all its
    invoices and other communications to dealers shows an Ontario address.  The one
    meeting it had with its dealers was held in Ontario.  Its National Service
    Manager, Serge, held training sessions in Ontario and had his only office in
    Ontario.  Thus presumptive factor b. is made out for the claims of all of the
    plaintiffs.

Joinder

[29]

The
    motion judge found that the test for joinder was satisfied given the appellants
    concession that they could be sued together in California.  He nevertheless went
    on to consider the issue of joinder, beginning with the claims of the
    non-Ontario respondents.

[30]

The
    motion judge agreed with the appellants central contention that the principles
    of joinder do not do away with the requirement for jurisdiction
simpliciter
.
    However, he found that this objection disappear[ed] given his finding that
    IFS carried on business in Ontario.

[31]

The
    motion judge concluded that the claims of the non-Ontario respondents were
    properly joined with the claims of the three Ontario respondents. First, he
    held that the Ontario choice of law clause demonstrated that the non-Ontario
    respondents intended their rights and obligations to be the same as if they
    operated in Ontario, relying on
405341 Ontario Limited v. Midas Canada Inc.
,
    2010 ONCA 478, 322 D.L.R. (4th) 177. The motion judge reinforced this
    conclusion by considering the fact that the claims arose out of the same series
    of transactions or occurrences and that there might be common questions of fact
    and law, within the meaning of rr. 5.02(1)(a) and (b) of the
Rules of Civil
    Procedure
, R.R.O. 1990, Reg. 194.  Put simply, the claims involved common
    disclosure, identically worded agreements, and the same course of dealings. It
    would also promote the convenient administration of justice for all eight
    claims to be heard together within the meaning of r. 5.02(1)(c) of the
Rules
.

[32]

The
    motion judge then considered joinder of the non-Ontario appellants.  He started
    by noting that the appellants did not argue that separate proceedings ought to
    be commenced against each respondent in different jurisdictions.  After
    highlighting the connection among the various appellants, he concluded that IFS
    carried on business in Canada (and specifically, Ontario), remotely.  The
    crux of the motion judges assessment of IFSs business activities appears at
    para. 59:

IFS is a Canadian company.  It carried on business as an
    automobile distributor in Canada.  It contracted with dealers in Canada to sell
    Saab automobiles within Canada.  It maintained formal offices, mailing
    addresses, bank accounts and tax accounts  all things necessary for it to take
    title to cars and parts in Canada and then transfer them to dealers for resale
    to consumers in Canada.  The defendants Libasci and King signed Disclosure
    Statements provided to four Saab dealers as required by franchise disclosure
    legislation in Ontario and Alberta.  In so doing, they acted as franchisor
    associates within the meaning of that legislation.  They made their
    representations in Ontario and Alberta respectively when they caused those
    Disclosure Statements to be delivered to and relied upon by dealers in those
    jurisdictions.  [Fleet Sales] is alleged to be and is named a defendant as a
    franchisors associate as well, and thus is included in the case because of its
    role relating to IFSs Canadian franchise business.

[33]

Based
    on this summary, the motion judge concluded that the four appellants were
    properly joined as parties.

Forum Non Conveniens

[34]

The
    motion judge then turned to a brief analysis of the doctrine of
forum non
    conveniens
, starting with the following statement, at para. 61:

Once it is concluded that there is jurisdiction in Ontario, and
    in any province in which IFS had dealers, and that it is permissible for the
    claims of all plaintiffs to be pursued in one proceeding against all four
    defendants, the issue of
forum non conveniens
virtually disappears.

[35]

The
    motion judge repeated the view he expressed in the Second Endorsement that all
    claims should be pursued in one action and that Ontario is the most convenient
    place for that action.

Disposition

[36]

In
    summary, the motion judge found that Ontario has jurisdiction
simpliciter
over
    the claims of all respondents against IFS. A single proceeding is a suitable
    and efficient way to advance these claims and Ontario is the most convenient
    forum for that single proceeding.

[37]

The
    motion judge therefore dismissed the motion.

Process of the Motion

[38]

The
    motion judge concluded the Amended Endorsement with a relatively lengthy
    section entitled Process of this Motion, which he identified as necessary because
    the motion was bad and called for a sterner response.

[39]

He
    began with the issue of delay.  The motion judge expressed the view that by requesting
    a full day for the hearing, the appellants had delayed the motion by almost
    nine months. He criticized the appellants for the amount of time they took to
    prepare their materials for the initial hearing and described their objection
    to the respondents evidence as technical. He asked rhetorically, What was
    the point?, repeating his concern over the delay the objection caused.   Although
    the motion judge acknowledged that not every line of questioning was useless,
    he concluded that overall, the appellants cross-examinations of the respondent
    affiants were a waste of time.

[40]

The
    motion judge next dealt with the merits of the motion. He expressed   frustration
    with appellants counsel for failing to realize that once the finding had been
    made that IFS carried on business in Ontario, there was not much left to talk
    about.

Post-Motion Events

[41]

Finally,
    the motion judge addressed what he referred to as post-motion events, including
    his motivation for releasing further reasons. He expressed a concern that
    jurisdiction motions present an opportunity to subvert the principles embodied
    in r. 1.02, saying that the fault lay in the
Rules
, the jurisprudence
    on attornment, and the courts, for making this possible.

[42]

The
    motion judge found that substantial indemnity costs were justified as a
    sanction for bringing a motion that, in his view, was so devoid of merit and
    bringing it in a time-consuming, expensive and impractical manner.  He fixed
    these elevated costs in the amount of $50,000 inclusive.

ISSUES

[43]

The
    appellants raise three main grounds of appeal:

1.

Whether the motion judge erred in law and principle regarding the
    application of the law germane to jurisdiction
simpliciter
and its
    intersection with joinder to the relevant facts;

2.

Whether the motion judge erred in law and principle regarding the
    application of the law germane to the issue of
forum non conveniens
to
    the relevant facts; and

3.

Whether the motion judges statements, conduct and delay give rise to a
    reasonable apprehension of bias.

[44]

As
    previously indicated, I have come to the conclusion that the appellants were
    effectively deprived of a fair hearing.  On that basis alone, the appeal must
    be allowed.  It is therefore neither necessary nor appropriate for me to
    consider the other two grounds of appeal.

APPLICABLE LEGAL PRINCIPLES

Presumption of
    Integrity

[45]

Judges
    benefit from a presumption of integrity, which acknowledges that they are bound
    by their judicial oaths and will carry out their duties in accordance with
    their legal responsibilities:
R. v. Teskey
, 2007 SCC 25, [2007] 2
    S.C.R. 267, at para. 29. In
R. v. Arnaout
, 2015 ONCA 655 (CanLII), at
    para. 18, this court described these responsibilities: A judge must both weigh
    the case impartially in his or her own mind and ensure that the circumstances
    objectively demonstrate his or her impartiality to an informed and reasonable
    observer.

[46]

Although
    judges enjoy the benefit of the presumption of integrity, the presumption can
    be rebutted by a judges comments or conduct:
Yukon Francophone School
    Board, Education Area #23 v. Yukon (Attorney General)
, 2015 SCC 25, [2015]
    2 S.C.R. 282, at para. 27.

Reasonable Apprehension of Bias

[47]

As
    noted by Abella J. in
Yukon Francophone
, at para. 21, the Supreme
    Court has consistently endorsed the test for a reasonable apprehension of bias as
    set out in de Grandpré J.s dissenting opinion in
Committee for Justice and
    Liberty v. National Energy Board
, [1978] 1 S.C.R. 369, at p. 394:

[W]hat would an informed person, viewing the matter
    realistically and practically  and having thought the matter through 
    conclude. Would he think that it is more likely than not that [the
    decision-maker], whether consciously or unconsciously, would not decide fairly.

[48]

The
    strong presumption of judicial impartiality is not easily displaced:
Cojocaru
    v. British Columbia Womens Hospital and Health Centre
, 2013 SCC 30,
    [2013] 2 S.C.R. 357, at para. 22.  A reasonable apprehension of bias requires a
    real likelihood or probability of bias:
Arsenault-Cameron v. Prince Edward
    Island
, [1999] 3 S.C.R. 851, at para. 2;
R. v. S. (R.D.)
, [1997]
    3 S.C.R. 484,
per
Cory J., at paras. 112-14. The test is an objective
    one, viewed from the perspective of an informed and reasonable observer:
Chippewas
    of Mnjinkaning First Nation v. Chiefs of Ontario
, 2010 ONCA 47, 265 O.A.C.
    247, at para. 230, leave to appeal refused, 33613 (July 18, 2010).  It is a
    high burden.

[49]

Significantly,
    in assessing whether a judges presumption of impartiality has been displaced,
    his or her individual comments or conduct during the hearing of a matter should
    not be considered in isolation but within the context of the entire proceedings:
S. (R.D.)
,
per
Cory J., at para. 134
;
Wewaykum Indian Band v. Canada
,
    2003 SCC 45, [2003] 2 S.C.R. 259, at para. 77
.

[50]

The
    objective of the test is to ensure both the reality and the
appearance
of a fair adjudicative process. Both are essential to maintaining public
    confidence in our system of justice:
Yukon Francophone
, at paras.
    22-23. It is not normally possible to prove actual bias. If the impugned
    conduct or comments have the cumulative effect of raising a reasonable
    apprehension of bias, there is no need to consider the impact of the bias.

THE
    PARTIES SUBMISSIONS

[51]

The
    appellants argue the cumulative effect of the following gives rise to a
    reasonable apprehension of bias:

1.

The motion judge displayed a pre-disposition against the
    appellants position and against motions of this nature, in general;

2.

The
    motion judge was gratuitously critical of the position taken by appellants and
    their counsel in bringing the motion and in the manner in which they proceeded
    with it; and

3.

The
    reasons for appeal purposes referred to by the motion judge as his Amended
    Endorsement, released over nine months after the Second Endorsement, display
    after-the-fact reasoning designed to address issues the motion judge then knew
    were being raised on appeal.

[52]

The
    respondents submit that the motion judge did his best to manage a complex
    motion. His comments, at times favoured one side, and at times, the other. The
    motion judge adequately explained his reasons for dismissing the motion in his
    Second Endorsement.  His delayed reasons merely amplified those findings and
    conclusions.

ANALYSIS

The Appearance of Pre-disposition

[53]

In
    my view, at various points in the proceedings the motion judge conducted
    himself in a manner that gave the appearance that he favoured the respondents
    position.

[54]

First,
    he adjourned the motion on his own initiative to give the respondents an
    opportunity to correct a flaw that he identified as being fatal to their
    position. In his First Endorsement, he explained that the goal here, as must
    be the case on a jurisdiction issue, should be to establish the underlying
    facts so that definitive determinations may be made and the case then proceed
    in the proper form.

[55]

Although
    the motion judges desire to determine the matter on the merits is commendable,
    a reasonable observer could perceive the adjournment as the motion judges
    going out of his way to assist the respondents. That perception is strengthened
    by the motion judges rather dismissive comment that he did not anticipate that
    the respondents cross-examinations of the appellants on their new material
    would add much to the background. Although understandable in isolation, the
    adjournment was the first step along a course of conduct that, considered as a
    whole, created the appearance that the motion judge was predisposed against the
    appellants position.

[56]

In
    the second scheduled hearing, the motion judge dismissed the motion halfway
    through the full-day that had been scheduled without giving counsel the
    opportunity to make oral submissions on two issues that he properly identified as
    principal arguments  joinder and
forum non conveniens.
The parties had
    prepared their arguments with respect to these issues
at the motion judges
    request.
It is true that comprehensive factums, dealing with these
    issues, had been filed. However, the motion judge decided the motion without
    allowing counsel to engage the court in oral argument on these important
    points.

[57]

Deciding
    the jurisdictional challenge without allowing for oral argument, especially
    with respect to the issue of joinder, is cause for particular concern in a case
    involving multiple parties on both sides.

[58]

The
    import of this concern is heightened by the extent to which the motion judge
    relied on joinder in deciding to dismiss the motion.  The motion judge
    concluded, at para. 47, that there is jurisdiction
simpliciter
of all
    claims in Ontario because the claims of the Ontario plaintiffs are properly
    joined with those of the non-Ontario plaintiffs:

I find that there is jurisdiction in each of the provinces in
    which IFS established dealers, including Ontario. I find that the
    [respondents] claims arise out of the same series of transactions and events
    and involve common questions of fact and law,
and are
    thus closely related to give rise to a substantial connection to any Canadian
    jurisdiction in which any one of the claims could be brought
. [Emphasis
    added.]

[59]

The
    motion judge thus effectively found that a non-Ontario plaintiff can be
    substantially connected to Ontario, without having established a presumptive
    connecting factor between the subject matter of the litigation and the forum,
    if the non-Ontario plaintiffs claim is properly joined with that of at least
    one plaintiff that has established jurisdiction
simpliciter
.

[60]

At
    para. 48, the motion judge found that if he was wrong in coming to this
    conclusion, IFS nonetheless had its strongest presence in Ontario. Therefore, presumptive
    factor b.  carrying on business in Ontario  had been made out for the
    claims of all eight plaintiffs. However, the motion judge failed to consider whether
    the appellants evidence had rebutted the presumption by showing, for example,
    that the subject matter of the litigation is unrelated to the defendants
    business activities in Ontario in the case of the four non-Ontario plaintiffs:
    see
Van Breda
, at para. 96.

[61]

The
    motion judge reached these conclusions without considering how this approach
    fits into the
Van Breda
framework, which departs from the historical
    emphasis on [a]bstract concerns for order, efficiency or fairness at the
    jurisdiction
simpliciter
stage by requiring a plaintiff to establish a
    clear presumptive connecting factor between the claim and the forum.

[62]

Jurisdiction
    motions are complex. This one is no exception, given that courts have yet to
    consider how and at what stage joinder should be factored into the
Van
    Breda
analysis.  In my view, determining the jurisdiction challenge
    without permitting counsel to debate the complicated, and as yet unresolved,
    issue of the intersection between joinder and jurisdiction within the
Van
    Breda
framework deprived the appellants of the opportunity to present
    their arguments fully. It also deprived the motion judge of the benefit of
    those arguments on this important issue.

[63]

I
    am also troubled by the motion judges having characterized several submissions
    the appellants made, as concessions.  I refer to his interpretation of the
    following answers the appellants provided in response to questions concerning
    their position how and where the respondents may properly advance their claims
    against the appellants.

a. Were the non-Ontario plaintiffs to commence proceedings in
    their home provinces in precisely the same form as framed in this proceeding,
    the defendants would not object to the jurisdiction of the courts of those
    provinces;

b. Were this proceeding to only involve the three Ontario
    plaintiffs, the defendants would not challenge the jurisdiction of the Ontario
    court; and

c. Were the 8 plaintiffs to commence proceedings before the
    courts of California in precisely the same form as framed in this proceeding,
    the defendants would not object to the jurisdiction of the courts of
    California.

[64]

At
    para. 96, the motion judge found that the appellants conceded that Ontario had
    jurisdiction
simpliciter
over the three Ontario respondents. However,
    earlier in his reasons, at para. 49, the motion judge concluded that
    [q]uestions of joinder [were] obviated by the [appellants] concession that
    all eight [respondents] may sue all four [appellants] together

[65]

This
    was a leap of logic from the answers given to the questions. Even assuming the
    appellants counsel can be taken to have conceded that Ontario had jurisdiction
simpliciter
over the three Ontario respondents, the motion judge was
    not entitled to automatically conclude that questions of joinder were obviated.
    The motion judge ought to have put this conclusion to the appellants to ensure
    that they understood the import he drew from the answers they gave to his
    questions. Although we do not have a transcript of the hearing before us, it
    does not appear that he gave them this opportunity.

[66]

It
    is important that concessions be clearly made and clearly identified as such:
    see e.g.
National Trust Co. v. Bouckhut
(1987), 61 O.R. (2d) 640
    (C.A.), at paras. 16-18. This is because concessions attract serious
    consequences. What has been conceded is taken as proven without further
    evidence or argument.

[67]

Despite
    his conclusion that the appellants had conceded that Ontario had jurisdiction
simpliciter
over the three Ontario respondents, the motion judge conducted his own
    analysis of the issues of jurisdiction and joinder. However, his failure to give
    the appellants the opportunity to orally address the separate issue of joinder
    and his assumption that the contentious issue of joinder was obviated by the
    answers to his questions respecting jurisdiction, means that his holding was infected
    by a flawed process.

[68]

Although
    the motion judge acknowledged the legitimacy of the appellants position on a
    few occasions, the overall tenor of his remarks was derisive and suggests a
    view critical of jurisdiction motions and of this motion in particular. I refer
    to the motion judges finding that the motion was an abuse of process, a
    colossal waste of time, and paras. 89 and 92 of his Amended Endorsement in
    particular:

And all of this is what led me on April 23rd to characterize
    this motion as not simply unmeritorious or doomed to failure, but as an abuse
    of process.  It has been brought in accordance with the Rules.  It has been
    presented effectively by competent and experienced counsel.  And yet it is
    patently without merit.  It had no prospect of advancing the litigation and
    could serve only to delay adjudication on the merits and drive up costs.



The net result is two years and tens of thousands of dollars in
    costs have been wasted.  I call that an abuse of process.

[69]

A
    finding that a proceeding or a step taken in a proceeding is an abuse of
    process is serious. The doctrine of abuse of process focuses on the integrity
    of the adjudicative functions of courts and has been used to describe proceedings
    that are unfair to the point that they are contrary to the interest of
    justice:
Toronto (City) v. C.U.P.E., Local 79
, 2003 SCC 63, [2003] 3
    S.C.R. 77, at para. 35, citing
R. v. Power
, [1994] 1 S.C.R. 601, at p.
    616.

[70]

The
    motion judge provided no factual or legal foundation for his comments and I see
    no indication that the motion was brought for the purpose of delaying the
    proceedings and adding legal costs.   His finding that the motion was an abuse
    of process, made on his own initiative, without the benefit of submissions or
    reference to any legal authorities, was, in my opinion, unwarranted.

[71]

The
    finding of abuse of process in these circumstances is another consideration relevant
    to the ultimate determination of whether the appellants have established a
    reasonable apprehension of bias.

Comments about the Appellants
    and their Counsel

[72]

It
    is important to acknowledge from the outset that it takes much more than a
    demonstration of impatience with counsel or even unwarranted discourtesy to rebut
    the strong presumption of impartiality:
Kelly v. Palazzo
, 2008 ONCA
    82, 89 O.R. (3d) 111, at para. 21.

[73]

However,
    courts will be rightly troubled when a motion judge is consistently discourteous
    towards counsel for no apparent reason. Derisive remarks will therefore be
    relevant to the issue of bias: see
Yukon
, at para. 52.

[74]

In
    all three endorsements, the motion judge repeatedly criticized appellants counsel
    on matters including their advocacy skills, knowledge of the law, and handling
    of the matter. When viewed in the context of the rest of the motion, I conclude
    that the appellants have demonstrated that the motion judges treatment of
    appellants counsel contributed to raising a reasonable apprehension of bias:
    see
S. (R.D.)
,
per
Cory J., at para. 141.

[75]

I
    refer to comments in the first two endorsements that the appellants cross-examinations
    were a waste of time and their argument was frustrating and interminably,
    circling around and about, in and around.

[76]

The
    motion judge went much further in his Amended Endorsement, at paras. 89 and 91,
    where he described the appellants decision to challenge the jurisdiction of
    the Ontario court:

It is what is known in the trade as litigating with
    prejudice.  As I said to counsel at the end of the motion, we do not litigate
    this way anymore.  The only qualification I would add to this statement is that
    I do not want to be taken as suggesting that this sort of approach to civil
    proceedings was ever appropriate, ever the way we litigated.



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.

[77]

I
    see no justification for any of these comments.  As noted above, the courts
    have yet to interpret the Supreme Courts decision in
Van Breda
as it
    relates to the relationship between joinder and jurisdiction. In my view, it is
    therefore not obvious that there is a place in Canada (at least one) where the
    Canadian distributor of Saab vehicles carries on business and may be answerable
    to the claims of its dealers, as the motion judge suggested in his Second
    Endorsement.

[78]

I
    see no basis for characterizing the motion as bad, accusing appellants counsel
    of deliberately delaying the matter, or criticizing him for his knowledge of
    the law or for the manner in which he ran his case.

Delayed Reasons

[79]

In
    his Second Endorsement, the motion judge advised counsel that he would be
    preparing reasons for appeal purposes.  He cautioned that these reasons may
    take a while.  In fact, they took quite a while  the parties waited over nine
    months for the Amended Endorsement. During those nine months an appeal was
    commenced and a stay of the motion judges decision was granted.

[80]

Delay
    in delivering further reasons, in and of itself, does not displace the presumption
    of integrity:
Teskey
, at para. 23.  Moreover, a judges knowledge of a
    pending appeal is just a factor to be taken into consideration:
R. v.
    Cunningham
, 2011 ONCA 543, 106 O.R. (3d) 641, at para. 47.

[81]

However,
    in all of these circumstances, and in particular having regard to the conduct
    of the proceedings,  I am of the view that an informed and reasonable observer
    would think that the Amended Endorsement was something other than an expression
    of the reasoning that led him to dismiss the motion.

[82]

This
    case bears some similarity to
Arnaout
, which made clear that conduct
    will have the effect of displacing the presumption of integrity if, in all the
    circumstances, an informed and reasonable observer would think that the
    amendment was an after‑the-fact justification for the decision rather
    than an articulation of the reasoning that led to the decision:
Arnaout
,
    at para. 23;

see also
Teskey
,
at
    para. 21.

[83]

In
Arnaout
,

the trial judges stated purpose in delivering
    amended reasons was to correct an error. This court held that, in so doing, the
    presumption of integrity had been rebutted. Although in this case the motion
    judge stated his intention to prepare further reasons for appeal purposes,
    the question is the same: Would an informed and reasonable observer see the Amended
    Endorsement as motivated, at least in part, by a desire of the motion judge to
    defend his decision to dismiss the motion against the specific attacks made in
    the appeal that, to the motion judges knowledge, were identified in this
    courts reasons for granting the stay? Such motivation may, even
    subconsciously, lead to reasons designed to justify the challenged decision
    rather than to reveal the reasoning that led to the decision:
Cunningham
,
    at para. 47.

[84]

In
    my view, the Amended Endorsement suggests that the motion judge was motivated
    to respond to the challenges to his decision. I refer to the motion judges
    expressly identifying and then responding to grounds of appeal addressed in the
    reasons on the stay motion. Specifically, the motion judge dealt with two of
    the three serious issues raised in the proposed appeal  the fact that his Second
    Endorsement only addressed jurisdiction in regards to the appellant IFS and the
    consequences of certain comments he made and actions he took.

[85]

I
    find the portion of the Amended Endorsement where the motion judge attempts to  justify
    his  handling of the matter, particularly troubling:

[93] I was concerned by excessive delay on April 23, 201[4]. I
    directed the parties to follow the schedule to complete pleadings, exchange
    documents and schedule discoveries, without regard to whether the defendants
    brought an appeal

[94] There were two other reasons for directing this schedule.
    Supplementary reasons were required for this decision because I used unusually
    strong language in disposing of this motion

[95] Second, I knew when I decided the motion that these
    reasons would be a long time coming.  I was concerned about the delay inherent
    in an appeal, but more, I was concerned that the parties would be delayed
    awaiting these reasons before they could proceed with any appeal.  I already
    had a significant backlog of reserve decisions in April 2014, and that
    situation got worse over the course of the year because of resource issues in
    this court that are well known to the profession.  By adjourning the motion
    back to myself I had hoped to save the parties nine months of delay, and my
    scheduling order was intended to ameliorate the risk that my delay in getting
    reasons out would leave the case in abeyance.

[96] Finally, I could see no basis for an appeal of the finding
    that Ontario has jurisdiction over the claims of the three Ontario plaintiffs 
    since this point was conceded by the defendants.  Therefore, the risk that time
    and resources could be wasted on this case while an appeal was pending was
    ameliorated considerably.

[86]

In
    these passages, the motion judge appears to insinuate himself into the appeal
    process by attempting to defend his actions and his comments.  It was an after‑the-fact
    attempt not only to justify but also to bolster his decision.

Conclusion
    Regarding a Fair Hearing

[87]

The
    assessment of a reasonable apprehension of bias is a difficult one. It requires
    a careful and thorough review of the proceedings since the cumulative effect of
    the alleged improprieties is more relevant than any single transgression.

[88]

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 judges
    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.

[89]

In
    my opinion, the cumulative effect of the motion judges 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.

[90]

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

DISPOSITION

[91]

For
    these reasons, I would allow the appeal, set aside the order below, and order
    that the motion be heard anew before a different justice of the Superior
    Court.

[92]

I
    would order the respondents to pay the appellants costs fixed in the amount of
    $20,000, including disbursements and applicable taxes. I would order the costs
    of the first jurisdiction motion to be at the discretion of the judge hearing
    the second jurisdiction motion.

Released: January 21, 2016 (KMW)

Gloria
    Epstein J.A.

I
    agree K.M. Weiler J.A.

I
    agree Grant Huscroft J.A.


