



COURT OF APPEAL FOR ONTARIO

CITATION: 2189205 Ontario
    Inc. v. Springdale Pizza Depot Ltd., 2013 ONCA 626

DATE: 20131016

DOCKET: C56822 and C56833

MacPherson, Watt and Pepall JJ.A.

BETWEEN

2189205 Ontario Inc., Parminder Mutti and Navjot
    Kaur Chandi

Plaintiffs (Respondents)

and

Springdale Pizza Depot Ltd.,
    Ranjit Singh Mahil, Dilaware Singh Khakh
, 2147390 Ontario Inc. and
    Kulwinder Singh

Defendants (
Appellants
)

David S. Altshuller, for the appellants, Springdale
    Pizza Depot Ltd., and Dilaware Singh Khakh

Kristina A. Davies, for the appellant, Ranjit Singh
    Mahil

Allan D. J. Dick and Shane Murphy, for the respondents

Heard:  October 7, 2013

On appeal from the order of Justice Edward M. Morgan of
    the Superior Court of Justice, dated February 26, 2013 and from the order of Justice
    Sidney Lederman of the Superior Court of Justice, dated March 1, 2013.

ENDORSEMENT

[1]

The proceedings in this case arise out of the valid rescission of a
    franchise agreement. The appellants are the owners of the franchise chain. The
    respondents operated a franchise for a few months, then rescinded the agreement
    because the appellants had failed to provide proper disclosure under the
Arthur
    Wishart Act, 2000
, S.O. 2000, c. 3.

[2]

The respondent franchisees obtained partial summary judgment against the
    appellants. On a reference, the Master determined the amount of compensation to
    be paid by the appellants to the respondents under s. 6(6) of the
Wishart Act
.

[3]

On a separate motion before the Master under rule 26.01, the appellants
    sought leave to amend their statement of defence and cross-claim to add a
    defence of equitable set-off. The Master permitted them to do so.

[4]

Both aspects of the Masters decision were appealed. Lederman J.
    dismissed the appellants motion to oppose confirmation of the Masters Report
    on the Reference. Morgan J. allowed the respondents appeal and limited the
    equitable set-off amendment to the respondents claim under s. 7 of the
Wishart
    Act
.

[5]

The appellants contend that Morgan J. erred in concluding that the
    Master intended the set-off amendment order to apply only to the claims
    advanced by the respondents under s. 7 of the
Wishart Act
.  We
    disagree.

[6]

The motion to amend was heard about two years after the respondents had
    been granted partial summary judgment on the s. 6 claim and several months
    after the Master had made his report on the reference. If set-off were to be
    raised in connection with the s. 6 claims, it should have been raised when the
    claims were adjudicated. We see no error in Morgan J.s conclusion that the
    Master intended to limit the application of the set-off amendment to the then
    outstanding s. 7 claims of the respondent.

[7]

The appellants contend that the Master and Lederman J. erred in
    principle and misapprehended the evidence in reaching their conclusions about
    the respondents s. 6 claims.  Again, we disagree.

[8]

The Master was the primary finder of fact. Provided his findings of fact
    were reasonable and rooted in the available evidence, the reviewing judge, as
    Lederman J. recognized, was bound to accord those findings deference. The
    Master and reviewing judge were well aware of the deficiencies alleged in the
    respondents proof. The findings made are grounded in the evidence, untainted
    by any misapprehensions, errors in principle, or palpable and overriding
    errors.

[9]

We are also of the view that the Master and Lederman J. were correct in
    their interpretation and application of the subsections of s. 6 of the
Wishart
    Act
.

[10]

The
    appeals are dismissed. The respondents are entitled to their costs of these
    appeals which we fix, with the agreement of counsel, at $8,000.00, inclusive of
    disbursements and all applicable taxes.


