



COURT OF APPEAL FOR ONTARIO

CITATION: Larizza v. Royal Bank of Canada, 2018 ONCA 632

DATE: 20180711

DOCKET: C64580

Pepall, van Rensburg and Paciocco JJ.A.

BETWEEN

Antoinette Larizza

Plaintiff (Appellant)

and

The
    Royal Bank of Canada, Royal Trust Corporation of Canada as the

Estate
    Trustee for the Estate of the Marcelle Kaye Trust,

The Bank
    of Nova Scotia, Wildeboer & Dellelce LLP,

Fasken Martineau DuMoulin LLP, Fasken Martineau DuMoulin
    International LLP,

Minto Group Inc.
, Bastedo Stewart & Smith, Bryan
    Smith, Albert Allan Rosenberg, Marwa Holdings Inc., Marwa Bloor Street Inc.,

M.A. Investments Inc., and
    Rosenberg Investment Group Inc.

Defendants (
Respondents
)

Julian Heller and Neil Foley, for the appellant

Gavin Tighe and Scott Gfeller, for the respondent Fasken
    Martineau DuMoulin LLP

Adam Grant and Karen Bernofsky, for the respondent Minto
    Group Inc.

Heard: May 25, 2018

On appeal from the judgment of Justice Lise G. Favreau of
    the Superior Court of Justice, dated October 13, 2017, with reasons reported at
    2017 ONSC 6140.

Pepall J.A.:

Introduction

[1]

The appellant, Antoinette Larizza, was 54 years old when she met Albert
    Allan Rosenberg through an online dating service in February 2012.  By August 2012
    and at Mr. Rosenbergs urging, the appellant had quit her job, sold her house,
    given the proceeds of sale to him, and moved with him into a Yorkville
    penthouse.  By October 9, 2012, the appellant had given Mr. Rosenberg about $230,000. 
    By March 2013, they were married.  Mr. Rosenberg told the appellant that he was
    a wealthy, 56 year-old Swiss-Canadian businessman and heir to an Ovaltine
    fortune.  In fact, he was 69 and a fraudster who had been convicted of fraud on
    multiple occasions.  The Ovaltine inheritance was non-existent.

[2]

By the summer of 2013, the appellant became aware that Mr. Rosenberg was
    not who he purported to be and that she had lost all the money she had given to
    him.  She seeks damages arising from her financial losses from various parties,
    including her penthouse landlord, the respondent Minto Group Inc. (Minto), and
    her lawyers, the respondent Fasken Martineau DuMoulin LLP (Faskens).  She
    commenced an action against them and others.

[3]

Minto and Faskens successfully brought motions for summary judgment, and
    the appellants action against them was dismissed.  She appeals from that
    judgment.  For the reasons that follow, I would dismiss the appeal.

[4]

I do not propose to repeat the unfortunate saga that is the subject
    matter of the motion judges decision.  I will simply summarize those facts
    that are germane to the claims against the two respondents.

A.      Claims against Minto

[5]

In May 2012, Mr. Rosenberg inquired about renting a penthouse in the
    Yorkville building in which he lived.  The building was owned and managed by
    Minto.  The appellant testified that all of the couples dealings with Minto
    had been left to Mr. Rosenberg.  Minto obtained an Equifax credit report on Mr.
    Rosenberg but concluded that there was insufficient information to justify
    rental of the penthouse to him.  The credit report noted two inquiries made in
    2009 by Correction Service.  Minto then asked Mr. Rosenberg the name of
    someone else on whom a credit report might be done in support of the proposed
    penthouse rental, and he provided the appellants name.  Minto obtained a
    credit report on the appellant without her knowledge or express consent.  Her
    credit rating was sufficient to enable her to lease the penthouse.  On May 23,
    2012, the appellant signed the lease that expressly stated that she was signing
    as the tenant, and Mr. Rosenberg signed it as occupant.  The lease commenced on
    July 1, 2012.  The two resided there together.

[6]

About one year later, in August, 2013, Minto wrote to the appellant and
    Mr. Rosenberg notifying them of the accumulation of two months of rent arrears and
    advising that Minto would commence legal action in the absence of payment.  The
    appellant then had a confrontation with Mr. Rosenberg over financial issues. 
    He assaulted her and was subsequently arrested.  On October 11, 2013, he
    pleaded guilty to assault and various fraud charges and was sentenced to 60 months
    in prison.  The proceedings revealed that he was a serial fraudster who had
    been incarcerated multiple times in the last 30 years.

[7]

The appellant claimed damages from Minto for various causes of action: intrusion
    upon seclusion, breach of contract, negligence, negligent misrepresentation,
    and intentional or negligent infliction of mental distress.

(i)

Intrusion upon Seclusion

[8]

On appeal, the appellant submits that the motion judge erred in concluding
    that there was no genuine issue requiring a trial with respect to her claim for
    intrusion upon seclusion.  In particular, she asserts that the motion judge erred
    in her interpretation and treatment of the relationship between the
Personal
    Information Protection and Electronic Documents Act
, S.C. 2000, c. 5 (PIPEDA)
    and the
Consumer Reporting Act
, R.S.O. 1990 c. C.33 (CRA) and in
    concluding that Mintos credit check on her without her knowledge or consent did
    not raise a genuine issue requiring a trial.

[9]

The motion judge properly set out the test for intrusion upon seclusion:

(i)    the
    defendants conduct must be intentional or reckless;

(ii)   the defendant must have invaded, without lawful
    justification, the plaintiffs private affairs or concerns; and

(iii)   a reasonable person would regard the invasion as highly
    offensive, causing distress, humiliation, or anguish:
Jones v. Tsige
,
    2012 ONCA 32, 108 O.R. (3d) 241, at para. 71.

[10]

Although
    Mintos conduct was intentional, the motion judge found that the appellant
    failed to meet the other two elements of the test.  She concluded that the
    credit report was lawful under the CRA but potentially unlawful under PIPEDA. 
    However, the motion judge found as a fact that the information in the credit report
    was not information about the appellants private affairs or concerns.  She also
    found that a reasonable person would not regard Mintos actions as highly offensive,
    causing humiliation or anguish within the meaning of the test.

[11]

For
    the purposes of this appeal, there is no need to address the second requirement
    and I decline to do so.  The motion judges finding on the third element of the
    test is unassailable and fatal to the appellants position.  The appellant had
    left the couples dealings with Minto to Mr. Rosenberg.  Minto obtained the
    report to determine whether to rent the penthouse to the appellant and Mr.
    Rosenberg; there was no improper purpose.  As the motion judge found, at paras.
    62-63:

Minto did not use the credit report for any purpose other than
    deciding whether to rent the unit to Ms. Larizza and there is no evidence that
    the information was disseminated or otherwise used improperly.

It is worth noting that Ms. Larizzas claim against Minto is
    not founded on allegations that she felt shocked, humiliated or anguished by
    the fact that Minto conducted the credit check.  Rather, the thrust of her
    claim is that Minto failed to protect her from Mr. Rosenberg.

[12]

I
    would not give effect to this ground of appeal.

(ii)

Breach of Contract

[13]

The
    appellant also submits that the motion judge erred in finding that Minto
    negotiated and performed the lease agreement in good faith.  The only contract
    between the parties was the lease.

[14]

The
    motion judge rejected the appellants breach of contract claim.  She did not
    err in that regard.  At paras. 67-70, she wrote:

In advancing the breach of contract argument, Ms. Larizza
    relies on the duty of good faith recognized by the Supreme Court of Canada in
Bhasin
    v. Hrynew
, 2014 SCC 71.  The conduct Ms. Larizza complains about are
    Mintos actions prior to the formation of the lease, namely the fact that Minto
    obtained the credit check without her consent, the fact that Minto dealt primarily
    with Mr. Rosenberg in negotiating the lease, and her contention that she was
    not aware that she was listed as the tenant on the lease.  She argues this
    conduct shows that Minto breached a general duty of good faith.

However, the flaw in this argument is that the duty of good
    faith recognized by the Supreme Court in
Bhasin v. Hrynew
, [2014 SCC
    71, [2014] 3 S.C.R. 494], at para. 73, arises in the context of the performance
    of the contract, and not from the circumstances leading up to the formation of
    the contract.  Moreover the obligation of good faith in the performance of a
    contract is a requirement not to lie or mislead the other party in the
    performance of the contract.



In this case, Ms. Larizza does not complain about Mintos
    performance under the lease or even that Minto was dishonest in the performance
    of its contractual obligations, but rather that Minto failed to take steps to
    protect Ms. Larizza from Mr. Rosenberg in the contract formation.

In my view, it is evident based on the record before me that
    Ms. Larizza does not have a viable claim for breach of contract against Minto.

[15]

I
    agree with the motion judges analysis and conclusion.

(iii)

Negligence, Negligent Misrepresentation and Intentional or Negligent
    Infliction of Mental Suffering

[16]

The
    appellant next claims that the motion judge erred in her negligence analysis.

[17]

This
    issue is readily addressed.  Assuming, without accepting, that a duty of care
    could even be established, the harm alleged was too remote.  Again, as the
    motion judge wrote, at para. 78:

In any event, this is a case in which the harm alleged is
    simply too remote to be foreseeable.  Ms. Larizzas complaint against Minto is
    not that its conduct improperly induced her to enter into the lease, thereby
    placing her in the position of incurring liability for the unpaid rent. 
    Rather, she claims that if Minto had alerted her to the issues surrounding Mr.
    Rosenbergs credit check and the fact that she was named as the tenant rather
    than him, she would have realized that Mr. Rosenberg was a fraudster and she
    would have avoided her financial losses and emotional distress.  The harm in
    this case is far too removed from the nature of the relationship between
    landlord and tenant, and cannot form the basis of a legal obligation owed by Minto
    to Ms. Larizza.

[18]

The
    claim for negligent misrepresentation, which was not pleaded and only asserted
    in the appellants factum filed before the motion judge, may also be disposed
    of on this basis.  The motion judge also properly rejected the claim of intentional
    or negligent infliction of mental suffering on the basis that there was no
    conduct by Minto that could be characterized as extreme, flagrant and
    outrageous, much less any evidence that Mintos conduct was calculated to harm
    the appellant.

[19]

For
    these reasons, I would dismiss the appeal against Minto and would order the
    appellant to pay Mintos costs fixed in the amount of $12,500, inclusive of
    disbursements and applicable tax.

B.      Claims against Faskens

[20]

A
    lawyer at the defendant law firm, Wildeboer & Dellelce LLP, who purportedly
    acted for Mr. Rosenberg (and who possibly acted for the appellant), referred
    the appellant to Elena Hoffstein, a partner at Faskens who specializes in
    estate planning and personal tax.  On September 10, 2012, the appellant met Ms.
    Hoffstein.  This was their only meeting.  The appellant states that she
    retained Ms. Hoffstein to advise her on a prenuptial agreement, estate planning,
    and a trust fund.  Specifically, she sought advice about: a prenuptial
    agreement that Mr. Rosenbergs lawyers in Switzerland were allegedly preparing;
    estate planning to draft a new will for the appellant given her pending
    marriage to Mr. Rosenberg; and the establishment of a trust.  Mr. Rosenberg was
    purportedly purchasing a $10 million insurance policy naming as the beneficiary
    a trust for the benefit of the appellant and her daughters.

[21]

Ms.
    Hoffstein stated that she advised the appellant that she did not practice
    family law and would have to refer the appellant to a family law lawyer when
    the prenuptial agreement was ready for review.  The appellant contested this
    evidence and claimed that Ms. Hoffstein was her family lawyer.

[22]

There
    was no written retainer.

[23]

After
    the initial meeting, the appellant and Ms. Hoffstein exchanged communications
    between October 17, 2012 and January 2013.  Ms. Hoffstein sent draft documents
    but never received responses to her inquiries.  The prenuptial agreement was
    never available for review from Switzerland (or for referral to a family
    lawyer).  Ms. Hoffstein requested further information, including the date of
    the appellants pending marriage to Mr. Rosenberg, but none was ever provided. 
    The appellant did not answer Ms. Hoffsteins emails or comment on drafts
    provided to her by Ms. Hoffstein in January 2013.  The appellant and Mr.
    Rosenberg married on March 30, 2013 without advising Ms. Hoffstein.  As found
    by the motion judge, none of the tasks were completed because Ms. Hoffstein did
    not receive instructions or information requested that would allow her to
    complete the tasks.

[24]

The
    appellant claimed damages from Faskens for various causes of action: negligence,
    negligent misrepresentation, breach of contract, and breach of fiduciary duty,
    all arising from her dealings with Ms. Hoffstein.

[25]

There
    was no allegation that Ms. Hoffstein was negligent in the manner in which she
    performed the services she provided.  Rather, the allegation is that, as part
    of the retainer, Faskens had a duty to protect the appellant from Mr. Rosenberg
    by investigating his background.  The motion judge captured the essence of the
    parties positions, at paras. 91 and 92 of her reasons:

Ms. Larizzas claim against Faskens is essentially that Ms.
    Hoffstein should have conducted searches with respect to Mr. Rosenberg that
    would have revealed that Mr. Rosenberg was not who he claimed to be, or
    alternatively that Ms. Hoffstein failed to refer Ms. Larizza to a family law
    lawyer, and that such a lawyer would have taken necessary steps to protect Ms.
    Larizzas interests by conducting background searches on Mr. Rosenberg.  There
    is also a suggestion that Ms. Hoffstein acted improperly because, rather than
    protecting Ms. Larizzas interests, she was acting at Mr. Rosenbergs behest to
    ensure that Ms. Larizza was not a gold digger.

Faskens responds to these allegations by arguing that Ms.
    Hoffstein did not have an obligation to conduct any searches to ascertain Mr.
    Rosenbergs identity, and that matters never reached a point where it was
    necessary for Ms. Larizza to be referred to a family lawyer.  Faskens also
    denies that Ms. Hoffsteins role was to investigate Ms. Larizzas motivations
    on Mr. Rosenbergs behalf.

[26]

On
    appeal, the appellant advances three arguments:

(i)    the motion judge erred in her findings relating to the
    scope of the retainer between her and Faskens;

(ii)   she also erred in concluding that Faskens did not have
    to adduce expert evidence on the standard of care applicable to Ms. Hoffstein;
    and

(iii)   she erred in awarding partial summary judgment.

[27]

I
    would not give effect to any of these arguments.

[28]

The
    motion judge found the appellants claims to be meritless.  I agree.  I will
    address each of the appellants grounds of appeal against Faskens in turn.

(i)      Scope of Retainer

[29]

The
    appellant complains that the motion judge shifted the onus of proof on the
    scope of the oral retainer from Faskens to the appellant.  She argues that Ms.
    Hoffstein needed to know everything about all aspects of the situation with [Mr.]
    Rosenberg, and advise [Ms.] Larizza accordingly.  In particular, she submits
    that the appellants evidence that Ms. Hoffstein was her family lawyer should
    be preferred over Ms. Hoffsteins contrary evidence.  She asserts that, had Ms.
    Hoffstein exercised reasonable due diligence, Mr. Rosenbergs true age and the
    unavailability of trust funds would have been revealed.

[30]

The
    motion judge properly noted, at para. 97 of her reasons, that:

In order to succeed on her negligence claim against Faskens,
    Ms. Larizza would have to demonstrate that the scope of Faskens retainer
    included an obligation to investigate Mr. Rosenbergs background.  In my view,
    there are a number of flaws in this argument.

[31]

She
    then proceeded to identify the flaws in this argument.  She noted that the
    appellant did not claim that there was ever any request that Ms. Hoffstein conduct
    a background check on Mr. Rosenberg.  The real dispute was whether there was an
    implicit requirement to do so.

[32]

The
    appellants claims in negligence, negligent misrepresentation, and breach of
    contract against Faskens depended on the appellants claim that there was an
    implied requirement for Ms. Hoffstein to conduct a background check.

[33]

The
    motion judge rejected the appellants position in this regard, stating that it
    defied common sense.  I agree.  Moreover, it is important to note that, as she
    also found, the fraud perpetrated on the appellant predated Faskens retainer.  The
    appellant had already sold her house, given Mr. Rosenberg $155,000, quit her
    job, and moved into the penthouse with him.

[34]

As
    for the appellants claim for breach of fiduciary duty, the appellant claims
    that Ms. Hoffstein failed to disclose a conflict of interest arising from the referral
    from Wildeboer & Dellelce LLP.  The motion judge found that Faskens had not
    been retained by Mr. Rosenberg.  The record supports such a finding.  Moreover,
    there was no evidence that the purpose of the referral to Ms. Hoffstein was to
    benefit Mr. Rosenberg.  A conflict of interest does not exist simply by virtue
    of a referral.

(ii)     Expert Evidence

[35]

The
    appellant submits that the motion judge erred by relying on common sense and
    states that expert evidence was required to determine the applicable standard
    of care.

[36]

I
    disagree.

[37]

At
    para. 103 of her reasons, the motion judge correctly observed that:

In any event, even if on a motion for summary judgment
    involving professional negligence the defendants burden of showing that there
    is no triable issue required the defendant to adduce expert evidence, I accept
    Faskens argument that no expert evidence is required in this case.  In
Krawchuk
    v. Scherbak
,
[2011 ONCA 352, 106 O.R.
    (3d) 598]
, at para. 133, the Court of Appeal held that there are
    two exceptions to the requirement for expert evidence to prove the negligence
    of a professional.  One of those exceptions is when the court is faced with non-technical
    matters or those of which an ordinary person may be expected to have
    knowledge.

[38]

As
    a non-technical and common sense matter, absent specific instructions, there
    could be no obligation on Ms. Hoffstein, even if she had been a family law
    lawyer, to investigate the background of the appellants future spouse. 
    Furthermore, there is no evidence from which it could be inferred that Ms.
    Hoffstein should have recommended such an investigation.  There is no evidence
    that the appellant ever expressed any suspicions about Mr. Rosenberg, and her
    marriage took place without telling Ms. Hoffstein.

(iii)    Partial
    Summary Judgment

[39]

Thirdly,
    the appellant submits that this was not the clearest of cases in which partial
    summary judgment was appropriate, and that given the ongoing litigation against
    other defendants, there was a risk of duplicative or inconsistent findings. 
    Moreover, she argues that partial summary judgment presented an access to
    justice issue because any adverse costs award could prejudice the appellants
    ability to continue her claims against the other defendants.

[40]

I
    do not accept these submissions.  The dangers outlined in
Butera v. Chown,
    Cairns LLP
, 2017 ONCA 783, 137 O.R. (3d) 561, do not present themselves in
    this case.  The claims against Faskens are standalone and limited in nature. 
    There is no real concern about duplicative or inconsistent findings arising
    with respect to the claims asserted against the remaining defendants.  This was
    the clearest of cases where the issues raised in the appellants claims against
    Faskens were readily separable from the balance of the case.

[41]

Moreover,
    although the motion judge would not have had the benefit of this courts
    decision in
Butera
, she expressly or implicitly considered the issues
    of delay, expense, and the possibility of inconsistent findings.  She was
    satisfied that the issues could be readily bifurcated from those in the main
    action and could be dealt with in a focused and cost-effective manner.

[42]

The
    motion judges decision is entitled to deference.  I would also note that the
    summary judgment motion did not seek to dismiss some of the causes of action
    against Faskens and leave others remaining.  I agree with Faskens that it would
    be disproportionate, inefficient, and costly to require them to remain as a
    defendant in the appellants action.  In my view, summary judgment was
    appropriate for the claims asserted against Faskens.

[43]

For
    these reasons, I would dismiss the appeal against Faskens and would order the
    appellant to pay Faskens costs fixed in the amount of $12,500, inclusive of
    disbursements and applicable tax.  I see no reason to depart from the principle
    that costs be paid forthwith.

Released:

SEP                                                 Sarah
    E. Pepall J.A.

JUL 11 2018                                    I agree
    K. van Rensburg J.A.

I
    agree David M. Paciocco J.A.


