



COURT OF APPEAL FOR ONTARIO

CITATION: Rajmohan v. Norman H. Solmon Family Trust, 2014
    ONCA 352

DATE: 20140505

DOCKET: C57972

Juriansz, Tulloch and Strathy JJ.A.

BETWEEN

Rajadurai Rajmohan

Plaintiff

and

Norman H. Solmon Family Trust
and Norman
    Harry Solmon

Defendants (
Appellant
)

and

Dilani Gunarajah and
Therese
    Selvamahal Edward Chandran as trustee of the Estate of Thambirajah Edward
    Chandran

Third Parties (
Respondent
)

Cameron J. Wetmore, for the appellant

Charles Sinclair, for respondent

Heard: April 28, 2014

On appeal from the order of Justice Victoria R.
    Chiappetta of the Superior Court of Justice, dated October 21, 2013.

ENDORSEMENT

[1]

The appellant appeals from the order of the motion judge dismissing its
    third party claim against the respondent on a motion for summary judgment. The
    appellant is the assignee of mortgages that the plaintiff granted to the late
    Norman Solmon. The respondent is the estate trustee of the late Mr. Chandran,
    who acted for Mr. Solmon on the mortgages. Mr. Chandran also acted for the
    mortgagors on the transaction. More than two years after the death of Mr.
    Chandran, the appellant filed its third party claim alleging solicitors
    negligence. The motion judge dismissed that claim on the basis that it was
    time-barred by s. 38 (3) of the
Trustee Act
, R.S.O. 1990, c. T.23.
    Section 38 (3) of the
Trustee Act
provides that an action against an
    executor or administrator of a deceased person shall not be brought more than
    two years after the death of the deceased.

[2]

Before the motion judge, the parties agreed that the
Trustee Act
would bar the appellants third party claim unless either of the doctrines of
    fraudulent concealment or special circumstances applied. The motion judge
    determined that neither of these doctrines applied. For the reasons that
    follow, we would dismiss the appeal.

A.

Fraudulent concealment

[3]

The motion judge carefully considered the rationale and requirements of
    the doctrine of fraudulent concealment as set out by this court in
Giroux
    Estate v. Trillium Health Centre
(2005), 74 O.R. (3d) 341 (C.A.), affg
    (2004), 69 O.R. (3d) 689 (S.C.). Justice Moldaver stated, at para. 29, that the
    doctrine prevents unscrupulous defendants who stand in a special relationship
    with the injured party from using a limitation provision as an instrument of
    fraud. As the motion judge observed in
Giroux
, three elements must be
    established to make out the doctrine:

a)

the defendant and plaintiff are engaged in a special relationship with
    one another;

b)

given the special or confidential nature of the relationship, the
    defendants conduct amounts to an unconscionable thing for the one to do to the
    other; and

c)

the defendant conceals the plaintiffs right of action (either actively,
    or as a result of the manner in which the act that gave rise to the right of
    action is performed).

[4]

In the circumstances of the present case, the motion judge was satisfied
    that the solicitor-client relationship between Mr. Solmon and Mr. Chandran was
    sufficient to qualify as a special relationship within the meaning of
Giroux
.
    She also found that Mr. Chandrans omissions were only apparent on a review of
    his file and so the concealment requirement was satisfied as well. However, she
    found the unconscionability requirement was not met because Mr. Chandans
    conduct was merely negligent and she would not characterize it as
    unconscionable.

[5]

On appeal, the appellant submits that Mr. Chandrans negligent conduct
    flowed from a breach of his fiduciary duties to Mr. Solmon, and the serious
    breach of his fiduciary duties rendered his conduct unconscionable. The
    appellant argues that Mr. Chandran breached his fiduciary duty to Mr. Solmon by
    failing to obtain his written consent to the dual retainer as well as to the
    advancement of the mortgage funds when the conditions stipulated in Mr.
    Solmons written instructions had not been satisfied.

[6]

The argument, while effectively advanced, founders on the motion judges
    findings of fact. The motion judge found that Mr. Solmon probably gave verbal approval
    to both the dual retainer and the advancement of the funds. Given these
    findings of fact, the motion judge was entitled to characterize Mr. Chandrans
    conduct in the circumstances as negligent, but not unconscionable.

[7]

Further, we do not accept the appellants alternative argument that
    these findings of fact reflect overriding and palpable errors by the motion
    judge. We cannot interfere with the inferences that the motion judge drew from
    the manner in which Mr. Chandran and Mr. Solmon had worked together in earlier
    transactions, and Mr. Solmons considerable experience in the lending business.
    The Supreme Court, in
Hryniak v. Mauldin
, 2014 SCC 7, has recently
    stressed that deference is owed to a motion judges findings of fact as well as
    findings of mixed fact and law made on summary judgment.

[8]

The appellant further submits that the delay it experienced in gaining
    access to Mr. Solmons client file constitutes a further breach of Mr.
    Chandrans fiduciary duties. Counsel argued that Mr. Chandran failed to obtain
    Mr. Solmons written consent before leaving the file with the solicitor who
    took over Mr. Chandrans practice upon his retirement. We agree with the motion
    judge that the delay in making the file available was occasioned by the new
    solicitors unilateral action. Neither Mr. Chandran nor the estate trustee
    caused that delay.

[9]

We are not persuaded that the motion judge made any reversible error in
    concluding the doctrine of fraudulent concealment did not apply in the
    circumstances of this case.

B.

Special circumstances

[10]

The
    applicable limitation period is prescribed by the
Trustee Act
and not
    the
Limitations Act, 2002
, S.O. 2002, c. 24, Sch. B. The appellant
    submits the doctrine of special circumstances continues to be available and
    permits the court to add parties to an existing action after the expiration of
    the limitation period. Thus, it argues that because the plaintiffs action was
    commenced within two years of Mr. Chandrans death, the court could allow it to
    institute its third party claim after the expiration of two years. We do not
    agree. A third party claim is itself an action under the
Rules of Civil
    Procedure
, R.R.O. 1990, Reg. 194, s. 1.03(1). The doctrine of special
    circumstances, if it applies, does not allow a party to commence a third party
    claim after the expiration of a limitation period:
Joseph v. Paramount
    Canada's Wonderland
, 2008 ONCA 469, 90 O.R. (3d) 401, at para. 28.

C.

Conclusion

[11]

The
    appeal is dismissed. The respondents costs are fixed in the amount of $8000
    all-inclusive, as agreed by counsel.

R.G. Juriansz J.A.

M. Tulloch J.A.

G.R. Strathy J.A.


