



COURT OF APPEAL FOR ONTARIO

CITATION: Marmer Penner Inc. v. Vacaru, 2022 ONCA 280

DATE: 20220412

DOCKET: C69573

Doherty, Huscroft and Harvison Young JJ.A.

BETWEEN

Marmer Penner Inc.

Plaintiff (Respondents in Appeal)

and

Felicia Vacaru (a.k.a. Felicia Purcaru)

Defendant (Appellant/Moving Party)

and

Legge & Legge and
    John Legge

Defendants (Respondents in Appeal)

Felicia Vacaru, as self-represented

Tanya Pagliaroli, for the respondents Legge & Legge
    and John Legge

Michael E. Girard, for the respondent, Marmer Penner
    Inc.

Heard: March 28, 2022 by video conference

On appeal from the judgment of Justice William S. Chalmers
    of the Superior Court of Justice, dated June 14, 2021, with reasons reported at
    2021 ONSC 3785.

REASONS FOR DECISION

[1]

The respondent, John Legge, and his law firm, Legge and Legge (Legge),
    acted for the appellant, Felicia Vacaru (Ms. Vacaru), in her divorce
    proceedings. The respondent, Marmer Penner Inc. (Marmer), was retained to
    provide forensic accounting advice during the divorce proceedings.

[2]

Although Ms. Vacaru paid substantial fees to Marmer, she did not pay all
    of the fees claimed by Marmer. Marmer sued her for the outstanding amount and
    sued Legge on the basis that he had given Marmer a personal undertaking to
    honour the fees.

[3]

Ms. Vacaru defended on the basis that there was an oral agreement that
    Marmer would limit its fees to a specified amount and, that in any event, Marmer
    had overcharged for some of the services provided. Ms. Vacaru also counterclaimed,
    alleging negligence by Marmer.

[4]

Ms. Vacaru crossclaimed against her co-defendant, Legge, alleging
    negligence by Legge in the course of the divorce proceedings. Ms. Vacaru
    maintained Legge had failed to take proper steps to prevent her husband from
    dissipating his assets during the proceedings. The negligence allegations
    focused on one specific property owned by the husband and his girlfriend and
    the events in early June 2008.

[5]

Marmer was successful in the main action. The trial judge granted
    judgment against Ms. Vacaru and Legge. Ms. Vacaru had abandoned her
    counterclaim against Marmer on the eve of trial. The trial judge also dismissed
    Ms. Vacarus crossclaim against Legge.

[6]

Ms. Vacaru appeals the judgment in the main action and the judgment
    dismissing her crossclaim. She also seeks leave to appeal the costs awarded to
    Marmer.

[7]

Ms. Vacaru brings a motion to adduce fresh evidence on the appeal. The
    fresh evidence relates to both the appeal in the main action and the appeal
    from the dismissal of the crossclaim.

[8]

Marmer and Legge submit the motion to admit fresh evidence should be
    refused and the appeal dismissed.

The Fresh Evidence Motion

[9]

The proposed fresh evidence consists of Ms. Vacarus affidavit with a
    number of exhibits attached.

(i)

The proposed fresh evidence on the main action

[10]

On
    the main appeal, Ms. Vacaru proffers Legges discovery evidence taken in 2014
    as fresh evidence. She has attached the transcript of that evidence to her
    affidavit.

[11]

Ms.
    Vacaru submits that Legges discovery evidence contains answers that support
    her position that Marmer overbilled her and undertook to limit its pretrial
    fees to $40,000. Ms. Vacaru contends she was not allowed to ask Legge questions
    about his understanding of the fee arrangement with Marmer because of an
    agreement that had been reached by Legge and Marmer prior to trial. The
    proposed fresh evidence is offered to support Ms. Vacarus claim that had she
    been allowed to question Legge at trial on his understanding of Marmers fees,
    his answers would have assisted her in defending the claim brought by Marmer.

[12]

Legge
    and Marmer did reach an agreement prior to trial in respect of Legges defence
    of Marmers claim. Counsel put the content of that agreement on the record at
    the outset of the trial. According to counsel for Marmer and Legge, Legge acknowledged
    his personal undertaking to honour Marmers fees and committed to abide by that
    undertaking. Legge also undertook that he would make no submissions at trial in
    respect of the fee claimed by Marmer.

[13]

According
    to the trial judge (Reasons, paras. 16-19), Legge was not questioned in-chief
    or in cross-examination about any limit that had been agreed upon with respect
    to Marmers fees. When asked by the trial judge, Legge indicated that Marmer
    had agreed to limit its fees to $40,000 to the completion of trial. His
    testimony was consistent with his Statement of Defence. The trial judge
    ultimately rejected this evidence.

[14]

The
    transcript of Legges discovery existed and was available at trial. To the
    extent that the rules of evidence and rules of practice permitted, Legges
    discovery was available to Ms. Vacaru at trial.

[15]

Ms.
    Vacaru claims she was prevented from effectively using the discovery evidence
    at trial by the rulings of the trial judge. The merits of this argument stand
    or fall on the trial record and are not affected by the contents of Legges
    discovery. If Ms. Vacarus complaint is with the trial judges ruling, the
    proposed fresh evidence is irrelevant. If Ms. Vacaru seeks to use the discovery
    evidence to give added weight to an argument she unsuccessfully made at trial,
    the transcripts do not qualify as fresh evidence.

[16]

A
    review of Legges discovery evidence reveals nothing that could possibly have
    affected the result in the main action at trial. There is no basis upon which
    it could reasonably be said that the contents of Legges discovery could be
    expected to have had any impact on the trial judges decision in the main
    action.

[17]

Legges
    discovery evidence is not admissible as fresh evidence on the appeal in the
    main action.

(ii)

The fresh evidence on the appeal in the crossclaim

[18]

On
    the appeal from the dismissal of the crossclaim, Ms. Vacaru seeks to introduce
    as fresh evidence emails from two former employees of Legge and two opinion
    letters from a person identified as a court qualified, certified questioned
    document examiner. The documents which Ms. Vacaru seeks admitted as fresh
    evidence are attached as exhibits to her affidavit. There is no affidavit from
    the former employees or the questioned document examiner.

[19]

Ms.
    Vacaru submits that the emails and opinions support her assertion made at trial
    that Legge had presented false evidence and deliberately attempted to mislead
    the court in respect of notes of two conversations involving Legge and Ms.
    Vacaru.

[20]

Evidence
    is admissible on appeal only if it would have been admissible at trial under
    the governing rules of evidence:
R. v. OBrien
, [1978] 1 S.C.R. 591.
    The documents in issue, which are attached to Ms. Vacarus affidavit, are
    hearsay in every sense of that word. They are out-of-court statements allegedly
    made by non-witnesses (the former employees and the document examiner) offered in
    this proceeding through the testimony of a witness in the proceeding (the
    affiant, Ms. Vacaru) as evidence of the truth of the contents of the statements
    made by the non-witnesses. The documents in the form tendered are not evidence
    of the truth of anything, and cannot be received as fresh evidence on appeal.

[21]

Even
    if the documents could qualify as evidence, they do not meet the other criteria
    required for the admissibility of fresh evidence. The documents relate to notes
    summarizing meetings involving Ms. Vacaru and Legge on February 7, 2008 and
    March 4, 2008. Ms. Vacaru submits the notes relating to the March 4, 2008
    meeting, filed by Legge at trial, were missing two of the five pages and that
    the pages had been reordered by Legge to make it appear as though the contents
    of part of the notes was properly attributable to Ms. Vacaru, when in reality
    the notes reflected statements made by Legge.

[22]

The
bona fides
of the notes of the two meetings, especially the March 4,
    2008 meeting, was litigated at trial. Ms. Vacarus position at trial was the
    same as the position advanced on appeal. She maintains that the evidence demonstrated
    that Legge deliberately fabricated and falsified evidence by removing some of
    the pages referable to the March 4
th
meeting, and reordering the
    remaining pages. Ms. Vacaru does not suggest that cross-examination on these
    notes had a direct impact on the substantive issues at trial. She does,
    however, vigorously maintain that cross-examination on the notes would severely
    undermine Legges credibility on all material matters, including those relating
    directly to the events underlying the crossclaim.

[23]

The
    fresh evidence does not advance Ms. Vacarus attack on Legges credibility for
    the following reasons:

·

At trial, Legge acknowledged he could not disagree with Ms.
    Vacarus suggestion as to the proper order of the pages referable to the March
    meeting. Neither he nor Ms. Vacaru authored the notes;

·

Legge did not refuse to produce the originals of the notes at
    trial; and

·

At trial, Legge offered an explanation for the missing two pages.
    A complete version of the document was found in Legges affidavit of documents
    and in the appellants trial exhibits. The proposed fresh evidence sheds no
    light on the believability of Legges explanation for the missing two pages.

[24]

The
    appellant offered no explanation for her failure to adduce the evidence offered
    on appeal at the trial. Legges credibility was front and centre, as was Ms.
    Vacarus argument that he attempted to mislead the court in respect of the
    notes. Had she believed her attack on Legges credibility would be buttressed
    by admissible evidence from the document examiner or Legges former employees,
    she could have taken steps to obtain that evidence at trial.

[25]

Finally,
    Ms. Vacaru has not satisfied us that the proposed evidence would have made any
    difference to the outcome. Her case on the crossclaim failed for many reasons,
    some of which (e.g. causation) had nothing to do with Legges credibility. The
    fresh evidence offered to attack Legges credibility could not possibly have had
    any effect on the trial judges findings on those matters that did not turn in
    any way on Legges credibility.

[26]

The
    emails and opinion letters are not admissible as fresh evidence on appeal.

The Appeal in the Main Action

[27]

Ms.
    Vacaru raises two issues on the main appeal. She takes issue with the trial
    judges finding that Marmer did not agree to a fixed fee for its services prior
    to trial, and did not overcharge or double-bill Ms. Vacaru. These are findings
    of fact.

[28]

The
    trial judge reviewed the evidence relating to the nature of the retainer
    between Marmer and Ms. Vacaru at length. He set out Ms. Vacarus position. The
    evidence overwhelmingly supported Marmers claim. At para. 83 of his reasons, the
    trial judge summarized some of that evidence. His ultimate conclusion, at para.
    87, is fully supported by the evidentiary record. Ms. Vacaru has not
    demonstrated any palpable or overriding error in the trial judges factual
    analysis.

[29]

The
    second issue raised by Ms. Vacaru relates to the agreement between Legge and
    Marmer concerning Legges position in the main action. Ms. Vacaru submits that
    the trial judge failed to ensure that she had access to the written version of
    that agreement.

[30]

Although
    Marmer and Legge had apparently intended to reduce their agreement to writing,
    there was no written agreement. The terms of their agreement were, however,
    clearly set out in counsels opening submissions. Nothing in the agreement
    prevented Ms. Vacaru from cross-examining Legge, both on the terms of the
    agreement with Marmer and on any matters relevant to either the main action or
    the crossclaim.

[31]

We
    were not referred to any ruling by the trial judge limiting Ms. Vacarus
    questioning of Mr. Legge in respect of his agreement with Marmer. Ms. Vacaru
    claims she did not appreciate she could not cross-examine Legge on his
    arrangements with Marmer. Whether that is in fact the case is irrelevant on
    appeal. There is nothing capable of attributing any misunderstanding Ms. Vacaru
    may have had to anything said or done by the trial judge. Nor is there anything
    indicating the trial judge may have been aware that Ms. Vacaru was under any
    misunderstanding.

[32]

The
    appeal in the main action is dismissed.

The Appeal in the Crossclaim

[33]

The
    trial judge found the crossclaim failed for several reasons. He held Ms. Vacaru
    failed to prove Legge breached the applicable standard of care and also failed
    to prove any causal link between Legges alleged negligence and Ms. Vacarus
    damages. The trial judge further held that Ms. Vacarus claim was barred by the
    applicable provision of the
Limitations Act
, 2002, S.O. 2002, c. 24
. If the trial judge was correct on
    any one of these three findings, Ms. Vacarus crossclaim could not succeed.

[34]

The
    negligence claim against Legge arose out of events on or about June 2, 2008.
    Legge learned that Ms. Vacarus husband was in discussions with the CIBC in
    respect of placing a mortgage on one of his properties. Ms. Vacaru claimed that,
    in the context of the ongoing litigation, and knowing what Legge knew about the
    character of her husband, Legge should have immediately taken steps to protect
    Ms. Vacarus interests by obtaining a restraining/non-depletion order in
    respect of the property on which her husband was seeking a mortgage. Ms. Vacaru
    also maintained Legge should have registered existing orders on the title to
    that property and put the bank on notice of Ms. Vacarus claim and the
    outstanding orders.

[35]

The
    trial judge considered the standard of care issues at paras. 91-110 of his
    reasons. He properly identified the legal principles and considered the
    evidence, in particular the competing evidence of the two experts offered by
    Ms. Vacaru and Legge. He ultimately preferred the defence expert on most
    issues. The trial judge gave reasons for accepting the evidence of the defence
    expert.

[36]

The
    trial judges findings are findings of fact. The trial judges findings of fact
    are reasonable and reflect no misapprehension of the evidence. There is no basis
    upon which this court can interfere with those findings.

[37]

On
    appeal, in addition to re-litigating issues determined by the trial judge, Ms.
    Vacaru argued that Legge was negligent in failing to register a temporary non-depletion
    order made by Justice Jarvis in respect of the husbands property. Neither
    expert offered any opinion as to whether the order of Justice Jarvis was
    registrable at the relevant time, or whether a reasonable lawyer in Legges
    position would have registered that order on title. In the absence of that kind
    of expert evidence, there can be no finding that the failure to register the
    order of Justice Jarvis constituted negligence.

[38]

The
    appellants arguments aimed at the standard of care findings cannot succeed.

[39]

The
    appellants causation arguments suffer from a similar shortcoming. After
    reviewing the causation arguments at trial (paras. 111-16), the trial judge
    concluded:

Theres simply no evidence upon which I can rely to find that
    even if there had been a breach of the standard of care, the breach caused Ms.
    Vacarus damages. Mr. Niman [Ms. Vacarus expert] testified that Herman J.s
    and Belobaba J.s orders were not binding on the bank. Mr. Dart [Mr. Legges
    expert] testified that the bank would not have done anything with a letter from
    Mr. Legge that enclosed Herman J.s order. If Mr. Legge had served CIBC with
    Herman J.s order or obtained a restraining order against CIBC, Mr. Purcaru [the
    husband] could have gone to a different bank, or Ms. Seliverstova [the
    husbands girlfriend] could have mortgaged the property at 37 Gloucester
    Street.

[40]

The
    appellant attempts to avoid the absence of evidence in the trial record by pointing
    to case law which she says demonstrates that banks have taken steps to freeze
    accounts in circumstances similar to the circumstances of her case. A trial
    judge can only make findings of fact based on evidence. The contents of law
    reports are not evidence and cannot be used to fill evidentiary gaps.

[41]

Ms.
    Vacaru focused much of her submission on her interpretation of the rules
    governing the kinds of orders that can be made in settlement conferences and
    trial management proceedings. This argument misses the point. The issue in a solicitors
    negligence action is not whether a rule could be interpreted to permit a
    certain kind of order in a given situation. Instead, the issue is what a reasonable
    solicitor could be expected to do or not do in the particular circumstances.
    That inquiry usually hinges on expert evidence and not on submissions about the
    kinds of orders that a particular rule may or may not contemplate. Even if a
    rule could be read as permitting a certain kind of order in a given situation,
    it does not follow that the failure to apply for that order amounts to
    negligence.

[42]

The
    appeal from the dismissal of the crossclaim is dismissed.

The Costs Appeal

[43]

The
    appellant seeks leave to appeal the costs order made in the main action. She
    challenges only the costs awarded to Marmer in defence of the negligence claim
    advanced by Ms. Vacaru by way of counterclaim in the main action. Ms. Vacaru
    abandoned her crossclaim just before trial.

[44]

The
    trial judge awarded Marmer costs on a substantial indemnity basis in the
    counterclaim. In doing so, he relied on Marmers offer to settle the crossclaim
    on the basis that it would be dismissed without costs.

[45]

The
    appellant briefly addressed her costs appeal in oral argument. Her complaint is
    exclusively with the quantum of the order.

[46]

Leave
    to appeal costs is granted sparingly. As there is no reason to doubt the
    correctness of the award of costs on a substantial indemnity basis, we see no
    reason to grant leave exclusively on the quantum question.

Conclusion

[47]

The
    motion to adduce fresh evidence is dismissed. The appeal in the main action is
    dismissed. The appeal in the crossclaim is dismissed. The motion for leave to
    appeal costs is dismissed.

[48]

The
    parties may submit written argument in respect of the costs of the appeal. The
    argument is not to exceed three pages. The respondents will file their
    submissions within 30 days of the release of these reasons. Ms. Vacaru shall
    file her submissions within 30 days of receipt of the submissions of Marmer and
    Legge.

Doherty J.A.
Grant Huscroft J.A.

A. Harvison Young
    J.A.


