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The following are some recent Texas appellate court cases that are important to consider.
Sabine Pilot Cause of Action-Damages- An employee of Safeshred was fired when he refused to drive a commercial vehicle he found to be unsafe and noncompliant with federal and state regulations. The employee sued alleging he had been terminated for refusing to commit an illegal act in violation of the cause of action created by the Texas Supreme Court in Sabine Pilot Service, Inc. v. Hauck, 687 S.W.2d 733 (Tex.1985). After a jury trial, the trial court entered a judgment awarding the employee economic damages and damages for mental anguish, as well as $200,000 in punitive damages. The employer appealed contending that punitive damages are not authorized among other points of appeal. The evidence showed that the truck violated several safety laws and that the employee told the employer to drive it or he was fired. When he refused, the employer fired him. During the trial, the employee testified that the actions of his employer subjected him to stress and caused him to lose a lot of sleep. The Court of Appeals upheld the economic damages for loss of pay and found that punitive damages were available for this cause of action provided evidence of malice or gross negligence is shown. The Court found that evidence existed that the employer showed a consistent pattern of requesting or ordering him to perform illegal acts and had misrepresented that the employee had abandoned his job instead of the truth-that he had been fired. The Court found that this was evidence of specific intent to harm the employee (citing Bennett v. Reynolds, 242 S.W.3d 866,895 (Tex.App.–Austin 2007) for the principle that falsity and fabrication concerning relevant events may evidence malice). Further, the evidence showed that the employer knew that the truck was illegal that the employee was being asked to drive, which was further evidence that he was being forced to choose between his livelihood or risking criminal behavior. However, the Court held that the evidence of mental anguish did not rise to the level of being compensable. The Court cited Parkway Co. v. Woodruff, 901 S.W.2d 434, 444 (Tex. 1995) for the principle that the record must show direct evidence of the nature, duration, and severity of the mental anguish for it to survive a challenge to its compensability. If a claimant fails to show this direct evidence, the court must conduct a traditional no evidence review. In this review, the court determines whether the record contains any evidence of a high degree of mental pain and distress that is more than mere worry, anxiety, vexation, embarrassment, or anger. The court noted that the absence of evidence of the nature, duration and severity of mental anguish, particularly when it can be readily supplied or procured by the plaintiff, justifies close judicial scrutiny of other evidence offered on this element of damage. In the Martinez case, the plaintiff testified that the that the ordeal was “very stressful” and caused him to lose “a lot” of sleep. However, the court stated that he did not present direct evidence of the precise duration or severity of the mental anguish he suffered. Therefore, the court then examined the record under a traditional no evidence analysis for other proof of a high degree of mental pain and anguish. The court said that a plaintiff may recover for mental anguish after providing evidence of “a mental sensation of pain resulting from such painful emotions as grief, severe disappointment, indignation, wounded pride, shame, despair or public humiliation or a combination of any of these.” Wal-Mart Stores v. Odem, 929 S.W.2d 513, 528 (Tex.App.–San Antonio 1996, writ denied). However, evidence that a plaintiff was “unable to sleep, was depressed, and suffered from anxiety…does not rise to the level of compensable mental anguish under Texas law. Lefton v. Griffith, 136 S.W.3de 271, 279 (Tex.App.-San Antonio 2004, no pet.). Based on this law the court held that the employee’s evidence of mental anguish did not rise to the level of being compensable. Editor’s Note: This opinion does not consider the real world of a trial and a plaintiff having to say all of these “magic words” in front of a jury, nor does it account for the non-verbal aspect of a jury’s examination of the plaintiff’s demeanor and unspoken emotions, which can demonstrate mental anguish as fully as words. Also, the plaintiff walks a fine line of spending too much time talking about his mental anguish and risk alienating a jury in appearing to be a cry baby or greedy. Also, it fails to account for those individuals who are not very expressive in their ability to communicate their genuine feelings and emotions. For these reasons, it would seem best to leave the determination of mental anguish to the jury and not engage in these mental games of “magic words” and trying to tell a jury about the “precise duration” or “severity” of the mental anguish. How does anyone express the “precise duration” and know whether it would ever survive appellate review (second guessing)? Also, this opinion should be suspect as to causes of action under the Texas Commission on Human Rights Act because the compensatory damages allowed are broader than just mental anguish. The Act allows damages for “emotional pain, loss of enjoyment of life, and inconvenience” in addition to mental anguish.
Employment Discrimination- Race and Disability.
Former employee of the city brought suit for disability and race discrimination and the city was granted summary judgment on the basis that employee failed to prove a prima facie case. The court stated that a prima facie case is shown by plaintiff showing (1) he was a member of a protected class, (2) he was qualified for his employment position, (3) he was subject to an adverse employment decision, and (4) he was replaced by someone outside his protected class, or he was treated less favorably than a similarly situated member of the opposite class. Number 4 of the prima facie case requirement is the one that can give many plaintiffs a problem; therefore, the court recognized that the federal courts have relaxed the requirements of proof of a prima facie case. The fourth requirement can be satisfied by generally showing that he was discharged “because of discrimination”. See, Palasota v. Haggar Clothing Co., 342 F3d. 569, 576 (5th Cir. 2003) and Nieto v. L & H Packing Co., 108 F3d 621, 624 (5th Cir. 1997).
Texas Department of Human Services v. Okoli, 317 S.W.3d 800 (Tex.App.-Houston 2010, pet. filed).
A former employee brought suit against the Texas Department of Human Services (DHS) under the Texas Whistleblower Act and the DHS filed a plea to the jurisdiction. The basis of the plea was that the employee did not report a violation of law to an appropriate law enforcement authority. It should be noted at this point that the Whistleblower Act protects a state employee’s report of a violation of civil or criminal law, as long as the report is in “good faith”, which is defined as an employee believing that the conduct reported was a violation of law and the employee’s belief was reasonable in light of the employee’s training and experience. The belief is tested as to whether it was subjectively believed by the employee to be a violation and objectively as to whether a reasonable employee in similar circumstances would believe it was a violation of law. In this case, the employee reported the violation of the law (misuse of funds in the DHS) to his supervisors in the DHS. The evidence showed that the DHS is authorized to investigate allegations of fraud and unlawful use of funds associated with its programs administered by its employees. The plaintiff proved that he was required by DHS policy the criminal matters up the chain of command and that the command had the duty to investigate reported violations and to file charges.
Tarrant County v. McQuary, 310 S.W.3d 170 (Tex.App.-Fort Worth 2010).
This case involves a Plea to the Jurisdiction in a Whistleblower case. Considering the fact that these pleas to the jurisdiction seem to be increasing rapidly, it would be good to review the standards for review of these cases by the appellate courts as set out in this case. A plea to the jurisdiction is a dilatory plea used to defeat a cause of action without regard to whether the claims asserted have merit. Bland Indep. Sch. Dist. v. Blue, 34 S.W.3d 547, 554 (Tex. 2000). The plea challenges the trial court’s subject matter jurisdiction. Bland, 34 S.W.3d 554. Whether the trial court had subject matter jurisdiction is a question of law that is reviewed de novo. Tex. Natural Res. Conservation Commission v. IT-Davy, 74 S.W.3d 849, 855 (Tex. 2002). The plaintiff has the burden of alleging facts that affirmatively establish the trial court’s subject matter jurisdiction. Tex. Association of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 446 (Tex. 1993). The pleading are to be construed liberally in favor of the plaintiff, look to the pleader’s intent, and accept the pleadings’ factual allegations as true. Tex. Department of Parks & Wildlife v. Miranda, 133 S.W.3d 217, 226 (Tex. 2004). If a plea challenges the existence of jurisdictional facts, the court may consider relevant evidence submitted by the parties, that is necessary to resolve the jurisdictional issues. The pleadings relevant to a review of a plea to the jurisdiction include amended petitions, the plea to the jurisdiction, and responses filed in connection with a defendant’s plea to the jurisdiction. City of Austin v. Ender, 30 S.W.3d 590, 593 (Tex.App.-Austin 2000, no pet.). A trial court’s review of a plea to jurisdiction mirrors that of a traditional motion for summary judgment. Miranda, 133 S.W.3d at 228. The defendant is required to meet the summary judgment standard of proof for its assertions that the court lacks jurisdiction. The plaintiff is then required to show that there is a disputed material fact regarding the jurisdictional issue. Shilling, 266 S.W.3d 101. If the evidence creates a fact question regarding jurisdiction, the trial court must deny the plea to the jurisdiction and leave its resolution to the fact finder. But, if the evidence is undisputed or fails to raise a fact question on the jurisdictional issue, the trial court rules on the plea as a matter of law. Id.
In this case the court of appeals considered whether the plaintiff’s notice to the county was sufficient in making a Whistleblower Act claim. In this case, the plaintiff never mentioned in her notice to the county of her complaint that she was making a Whistleblower Act claim, nor did she allege a violation of any law. The only complaint she made in her email to her supervisor was that she had not received any evaluations as required by her job description. Simply requesting an employer to reconsider termination is not sufficient notice of a claim either. An employee does not have to specifically mention that she is making a claim under the Whistleblower’s Act. However, the employee must in some reasonable manner communicate to her employer that she believes her termination was in retaliation for reporting illegal activity or that a potential Whistleblower claim exists. Therefore, the court ruled that the employee’s Whistleblower claim failed.

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Does the Oakland Mayor Face Legal Liability for Warning About ICE Raids?
There are, of course, political implications to Schaaf’s decision to publicly alert residents of upcoming federal law enforcement operations. An example of the political sensitivity of this topic can perhaps be found in the abrupt resignation of ICE spokesman James Schwab, who quit over statements made by Homan and Attorney General Sessions regarding Schaaf’s actions that Schwab said were “false” and “misleading.” For the purposes of this article, however, I am interested only in the legal questions that might be raised by the Oakland mayor’s (quasi-)official actions and the state and local policies reflected in this context.
While many Trump administration policies have generated significant backlash from citizens and advocacy groups, it is noteworthy just how much resistance some state and local governments have exhibited toward President Donald Trump’s immigration policies. Immigration-related federalism questions predate the current administration, of course, but prior to the current administration, they generally followed a model where state or local authorities inserted themselves into immigration policy and enforcement by creating new criminal and civil laws designed to regulate immigration at the state and local level. For example, in 2010, the Arizona state legislature passed S.B. 1070, the purpose of which was to “discourage and deter the unlawful entry and presence of aliens and economic activity by persons unlawfully present in the United States,” and, inter alia, gave state and local law enforcement the power to arrest without a warrant anyone “the officer has probable cause to believe…has committed any public offence that makes the person removable from the United States.” Similarly, between 2006 and 2007, the city of Hazleton, Pa., enacted ordinances that made it unlawful for any person to “knowingly recruit, hire for employment, or continue to employ, or to permit, dispatch, or instruct” any person without work authorization “to perform work in whole or in part within the City,” and also made legal immigration status a condition precedent to entering into a housing rental agreement within Hazleton.
In both of the above examples, federal courts held that the relevant statutes were preempted by federal immigration law. Briefly, federal preemption doctrine originates in the Supremacy Clause of the U.S. Constitution (art. VI, cl. 2), and renders any state or local law unenforceable that either conflicts with existing federal law or seeks to regulate in a field where Congressional regulation “left no room for the States to supplement it.” In Arizona v. United States, 567 U.S. 387 (2012), the federal government challenged S.B. 1070 as preempted. The Court, in a 5 to 3 decision (Justice Elena Kagan did not take part), held that the provisions that created a state law crime for being unlawfully present in the United States, for working or seeking work when not authorized to do so, and authorizing the warrantless arrests of anyone the officer reasonably believed to be removable from the United States were preempted. In Lozano v. City of Hazleton, 724 F.3d 297 (3d Cir. 2013), plaintiffs challenged the city’s immigration ordinances, and the Third Circuit Court of Appeals, citing Arizona, held that Hazleton’s immigration-based housing and employment provisions were preempted, as well. The City of Hazleton appealed the court’s decision, but the Supreme Court denied certiorari.
Examples like Arizona and Hazleton illustrate efforts by some state and local governments to expand their authority to enforce immigration laws as a reaction to Obama administration immigration policies those local governments felt were too lax. In contrast, current state and local reactions to Trump administration immigration policies are based on a widespread perception that federal immigration policy under Jeff Sessions’ leadership of the Justice Department has become overzealous, racist, and xenophobic, and serves to destabilize communities, creating more problems for states and cities than they solve.
Some city governments have reacted by enacting ordinances that limit their agencies’ participation in certain federal immigration efforts, joining efforts by cities and counties throughout the United States that began in the 1980s as challenges to the Reagan administration’s policy of denying asylum to refugees of the wars in Central America. The rationale behind these “sanctuary city” policies is based on the local governments’ desire for safer communities by fostering trust and cooperation between immigrant communities and the police. It should be noted that “sanctuary city” is not a legal term, and often carries with it the implication that cities enacting such ordinances prohibit all cooperation with ICE and other federal immigration authorities, which is not the case. Rather, these policies, variations of which have been adopted in cities such as Chicago, Seattle, San Francisco, Philadelphia, and New York, are based on the idea that communities are both safer and better off when immigrants do not fear adverse consequences to themselves or to their families from interacting with local law enforcement officers. These policies do not, however, limit cooperation with federal agencies in criminal justice efforts.
Further, in July 2017, Attorney General Sessions announced that a federal grant meant to support state and local law enforcement efforts by providing funds for equipment, personnel, and training, would now have two new immigration policy-related conditions. First, local authorities must provide federal agents with advance notice of the scheduled release from state or local correctional facilities of certain individuals suspected of immigration violations. Second, local authorities must provide immigration agents with access to city detention facilities and individuals detained therein.
Many of the “sanctuary jurisdiction” cities targeted by Trump’s Executive Order, including San Francisco, Chicago, Seattle, and Philadelphia, challenged these new conditions on federal funding for local law enforcement as unconstitutional, and went to court seeking preliminary injunctions enjoining the enforcement of the Executive Order and Attorney General Sessions’ pronouncement. While the courts in the respective cases varied somewhat in their reasoning, all but one of the courts (Seattle’s case is still pending) have granted preliminary injunctions against the withholding of federal grant monies based on these new “sanctuary city” conditions. See City of Chicago v. Sessions, 264 F.Supp.3d 933 (N.D. Ill. Sep. 15, 2017); County of Santa Clara v. Trump, 275 F.Supp.3d 1196 (N.D. Cal. Nov. 20, 2017); City of Seattle v. Trump, Case No. 17-497 (W.D. Wash. 2017); City of Philadelphia v. Sessions, 2017 WL 5489476 (E.D. Penn. Nov. 15, 2017). One of the key points of disagreement between these courts relates to whether the Tenth Amendment “anti-commandeering” principle, a federalism doctrine built around questions of state vs. federal sovereignty (the details of which are beyond the scope of this article, but may be addressed in later articles), prohibited federal immigration officials from conscripting state and local authorities into enforcing federal laws.
With this context, could Mayor Schaaf’s public warning of imminent ICE raids result in legal liability for her or her office? It is possible that she could be considered an accessory after the fact if a case could be made that she obstructed justice by warning of impending ICE raids. 18 U.S.C.A. § 3 holds that, “Whoever, knowing that an offense against the United States has been committed, receives, relieves, comforts or assists the offender in order to hinder or prevent his apprehension, trial or punishment, is an accessory after the fact.” The term “offense” in this context is defined as “any criminal offense, other than an offense triable by court-martial, military commission, provost court, or other military tribunal, which is in violation of an Act of Congress and is triable in any court established by Act of Congress.” Being in the United States unlawfully is not itself a criminal office, but a civil one.
So, for example, if someone was living in Oakland after overstaying their visa, they would be guilty only of a civil violation. If, however, that person had entered the United States illegally, they would be committing a crime. Schaaf has stated that she consulted legal counsel before making her statement, and because she obtained the information about the impending ICE raids from “unofficial sources” rather than formal government channels, she does not believe she obstructed justice. The question thus becomes whether Schaaf had actual knowledge of people in Oakland who had entered the country illegally.
Homan, the ICE deputy director who is not a fan of Schaaf’s public announcement of impending ICE raids, has in the past also floated the idea that mayors and other government officials in “sanctuary cities” should be held liable under 8 U.S.C.A. § 1324, the statute that addresses the “bringing in and harboring of certain aliens.” This statute attaches criminal penalties to “any person who knowing or in reckless disregard of the fact that an alien has come to, entered, or remains in the United States in violation of law, conceals, harbors, or shields from detection, or attempts to conceal, harbor, or shield from detection, such alien in any place, including any building or any means of transportation.” Perhaps the most significant question under this statute is whether or not Schaaf actively shielded specific immigrants from ICE activity, a fact that is not at all clear from what I have seen reported thus far.
These questions might be considered moot if raised under the Obama administration, but Trump’s government has shown themselves to be very aggressive on immigration policy, and may well attempt to bring a criminal action against Schaaf. In line with this aggressive posture, on March 6, the Trump administration filed suit against California, asserting that three recently passed state “sanctuary” laws were unconstitutional, making it impossible for federal immigration agencies to do their job, and has asked a federal court to block their enforcement. How this case—and any future case against Schaaf—plays out will no doubt have implications for the other “sanctuary jurisdictions” across the United States, and bear watching.
Lecturer in Law and Executive Director of the Center for Technology, Innovation and Competition at the University of Pennsylvania Law School Follow him on Twitter (@jvagle).


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For Plaintiff: Alsup v. 3-Day Blinds, Inc., 435 F. Supp. 2d 838 (S.D. Ill. 2006); Rutherford v. Merck & Co., Inc., 428 F. Supp. 2d 842 (S.D. of IL 2006); Condie v. Solutions Plus, Inc., 10 S.W.3d 608 (Mo. Ct. App. 2000); May v. SmithKline Beecham Clinical Lab, Inc., 710 NE 2d 460 (Ill. Ct. App. 1999); Matheis v. May Department Stores, 1999 U.S. Dist. LEXIS 21917 (E.D. Mo. 1999); Fred Miller, Jr. v. American States Insurance Co., 175 F.3d 1025 (8th Cir. 1999); M.E.S. v. Daughters of Charity Services of St. Louis, 975 S.W.2d 477 (Mo. Ct. App. 1998); Fairchild v. Forma Scientific, 147 F.3d 567 (7th Cir. 1998); Powell v. State Farm, 1998 U.S. App. LEXIS 24407 (8th Cir. 1998); Raskas Foods v. Southwest Whey, 978 S.W.2d 46 (Mo. Ct. App. 1998); Weibert v. Wal-Mart Stores, 980 S.W.2d 59 (Mo. Ct. App. 1998); Sinclair v. United Healthcare of Georgia, Inc., 1997 U.S. Dist. LEXIS 23696 (N.D. Ga. 1997); Baan v. Director of Revenue, 980 S.W.2d 1 (Mo. Ct. App. 1997); Bauer v. Southwestern Bell Telephone Co., 958 S.W.2d 568 (Mo. Ct. App. 1997).
For Defendant: Gregory Pernoud, DDS v. Philip Martin, MD, 891 S.W.2d 528 (Mo. Ct. App. 1995); Harold Piper v. Missouri Pacific Railroad, 847 S.W.2d 907 (Mo. Ct. App. 1993); State ex rel. St. Anthony's Medical Center v. Provaznik, 863 S.W.2d 21 (Mo. Ct. App. 1993); Baggerly v. Missouri State Employees Retirement System, 858 S.W.2d 765 (Mo. Ct. App. 1993); ; U.S. v. Locklin, 943 F.2d 838 (8th Cir. 1991).
Other: In re Prudential Ins. Co. of America Sales Practices Litigation, 962 F. Supp. 450 (D.N.J. 1997); Weaver v. State Farm Mutual Auto Insurance Co., 936 S.W.2d 818 (Mo. 1997).

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Recently, the NCAA came out with best mental health practices for student athletes. Those best mental health practices can be found here. What I am particularly concerned with is Appendix F, which has all kinds of screening questions designed to assess whether a student athlete has a particular MH disability. Those screening questions include: a general index; disordered eating; depression; anxiety; alcohol use; marijuana use; sleep apnea; insomnia; and ADHD. There is absolutely no doubt that these questions would be considered disability related inquiries as discussed in this blog entry of mine. So, the very first question is whether the student athletes would be considered employees. If so, these disability related inquiries, as discussed in the aforementioned blog entry, would not be permissible unless made pursuant to a conditional job offer i.e. being a student athlete. Whether a student athlete is an employee is not an easy question to answer. For example, many people are aware that an administrative judge of the NLRB found Northwestern football players to be employees. That decision was appealed and the NLRB elected not to get involved and threw it out. Nevertheless, the question remains whether a student athlete is an employee. If they are, then the title I statutory scheme with respect to preemployment medical inquiries/disability related inquiries, conditional job offers, postemployment medical exams needs to be followed. If they are not, then, the question becomes just what are the essential eligibility requirements of the program or activity the student athlete is involved in. Clearly, a school would be within its rights to insist upon a person being physically and mentally able to perform as a student athlete. The question is has the school listed that as an essential eligibility requirement? Have they even methodically developed essential eligibility requirements?
So, let’s assume that the student athlete is not an employee. The question then becomes has the school listed being in good physical and mental health as an essential eligibility requirement of being a student athlete. Assuming it has, I don’t see the problem in having these questions answered. The question becomes what does the school do once the questions are known. If the school summarily dismisses or unduly restricts an athlete that reveals positive answers to any of these questions, then the school has a problem. The question the school needs to answer is whether the person can do the essential functions of being a student athlete with or without reasonable modifications; Reasonable modifications being anything short of a fundamental alteration or an undue burden.
Perform an audit as to whether your University or college is in compliance with the ADA.
Don’t forget about § 504 of the Rehabilitation Act, which has similar but not exactly the same rules as the ADA. Also, causation is different.
Make sure your athletic programs have essential eligibility requirements and that being in good physical or mental health is one of those requirements.
Once asking the questions and getting the answers, make sure that if a disability is revealed, it is assessed whether the person can perform the essential functions of being a student athlete with or without reasonable modifications. Remember, you want to be thinking in both terms of an undue burden as well as fundamental alteration.
One of the most complicated topics around is the doctrine of sovereign immunity, which comes from England and says that the King cannot be sued without his consent. We have carried over this doctrine into our 11th amendment to the U.S. Constitution. As we have discussed previously numerous times, there are situations where a State can be sued without its consent. For that to be true, Congress has to do two things. First, it has to state in the law that States are waving their sovereign immunity. Second, the law has to be a proportional response to the harm seeking to be redressed. Whether the law is a proportional response to the harm being addressed, depends entirely upon what equal protection classification the group falls in. Depending upon the classification, the legislators get more discretion to come up with comprehensive schemes to remedy the past harms. As you may recall, there are varying levels of equal protection classification: rational basis (for everyone not in the intermediate or strict scrutiny class); intermediate scrutiny (gender); and strict scrutiny (race). It is unclear as to where Gays and Lesbians will fall. On that, we may know more when the pending gay marriage decisions come down from the United States Supreme Court. As is typical for my blog entries, I have divided the blog entry into categories: introduction; facts; court’s reasoning (supervisory liability of the state); court’s reasoning (sovereign immunity of the sheriff); and takeaways. The reader is free to focus on any or all of the categories.
Plaintiff is deaf with no functional ability to speak English or read lips (it is a myth that all deaf people are capable of reading lips. I happen to be fortunate that I can get 50% of what is said on the lips, which is the absolute best a deaf person could do in any event, but I am not typical). Plaintiff was born and raised in Ethiopia and became a United States citizen in 2008. His knowledge of English is limited as a result of courses he took through Gallaudet University but he struggles to read, write, and understand even basic English sentences. His primary language is ASL, and his employment history is limited to manual labor jobs not requiring proficiency in spoken or written English. On February 2, 2014, plaintiff was arrested at Ronald Reagan Washington National Airport after he went there to find somewhere warm to sleep. From there, things went downhill in a big way. Shortly after his arrest, in the early morning hours of February 3, 2014, he was transported to the jail where he started the booking process. While there he attempted to communicate with the national airport police officers and jail personnel using gestures and in writing. He also requested an ASL interpreter but one was not provided. As a result, plaintiff had no idea why he had been arrested nor did he understand why he was being detained in the jail. The plaintiff also appeared in front of a judge via videoconference, but he could not signal to the judge that he was deaf because jail personnel instructed him to remain still. As part of the booking process, he underwent a medical evaluation where he made additional request for assistance. His requests were again denied. Since he did not have an ASL interpreter, he did not understand the medical evaluation process and refused to sign a consent form that he could not read. Even so, jail personnel forced the needle into his arm without his consent and placed him in isolation. Scared and confused, the plaintiff banged on the cell door repeatedly gesturing for assistance still being unaware as to why he was being incarcerated. He then had a negative skin reaction to the fourth medical procedure and underwent an additional medical procedure, but still did not understand what was happening. It was only at his arraignment because he had the assistance of an ASL interpreter, that he learned he had been arrested and incarcerated for allegedly stealing an IPad. He then returned to the jail after his arraignment and remain incarcerated for nearly 6 weeks. During that period of incarceration, defendant refused to provide effective means for plaintiff to communicate, and consequently, plaintiff missed private meals, recreation, and rehabilitative services at various times. As if that wasn’t enough, the jail also failed to provide plaintiff with inadequate accommodation for telephone access. While the jail did offer plaintiff a TTY, that was ineffective because of the plaintiff’s limited knowledge of the English language. The jail did not have videophone or any device equipped with a video phone software allowing plaintiff to be able to make telephone calls. As a result, plaintiff was unable to make a telephone call for the duration of his incarceration at the jail. He also could not regularly communicate with the court appointed attorney via telephone unlike other inmates and had to rely on in person visit made on the attorney’s own accord.
Plaintiff sued both the local Sheriff and the State for violating title II of the ADA and § 504 of Rehabilitation Act and sought both declaratory and compensatory relief. Interestingly enough, no claims of constitutional violations were made. Both the Sheriff and the State defended on the grounds of sovereign immunity. The State also defended on the ground that they were not liable as supervisors for the acts that occurred in the jail, which is run solely by the Sheriff (prisons are usually run by the state while jails are usually run by the county).
1. With respect to supervisory liability of the State, the court was not buying it. For such liability to occur, you need to find inaction or deliberate indifference on the part of the State that affirmatively causes the particular constitutional injury the plaintiff suffers. Further, that inaction or deliberate indifference must be a direct cause of the injury. Since the State of Virginia clearly has a separate set up for county jails versus prisons, the court concluded that Virginia does not supervise the sheriff in the manner necessary to make a prima facie case of supervisory liability. Therefore, the State was dismissed from the case because a sufficient showing could not be made that the state was liable as a supervisor.
1. The ADA unequivocally expresses Congress intent to waive sovereign immunity under title II of the ADA.
2. While it is true, that the Supreme Court has said that sovereign immunity is waived by the State with respect to ADA violations that rise to a violation of the 14th amendment, the plaintiff did not make any 14th amendment claims.
A. Citing Tennessee v. Lane, the court said that title II was enacted in response to a pattern of unconstitutional disability discrimination by States and non-State governmental entities with respect to the provision of public services.
B. Plaintiff was a qualified individual with a disability. That is, the plaintiff was deaf and he was also capable with the provision of auxiliary aids and services of meeting the essential eligibility requirements for the receipt of services or the participation in programs or activities provided by the jail.
C. Title II of the ADA authorizes the Attorney General to promulgate regulations implementing title II of the ADA. Those particular regulations makes clear that qualified inmates or detainees with disabilities cannot be subject to disability-based discrimination, and that jails and prisons are also required to furnish appropriate auxiliary aids and services where necessary so inmates and detainees with disabilities have an equal opportunity to participate in, and enjoy the benefits of, or service, program or activity of the jail. Auxiliary aids and services do include qualified ASL interpreters as well as video remote interpreting services.
D. Inmates possess a significant liberty interest in avoiding the unwanted administration of antipsychotic drugs under the Due Process Clause of the 14th amendment.
E. The Due Process Clause of the 14th amendment and the Confrontation Clause of the sixth amendment, which is applied to the States via the 14th amendment, both guarantee to a criminal defendant the right to be present at all stages of the trial where his absence might frustrate the fairness of the proceedings. Since the deaf detainee was eligible to participate in the hearing, title II applied and he was denied the ability to participate in the hearing to the same extent as a person without a disability.
F. Not only did the plaintiff not understand the judicial proceeding, the jail personnel actively prevented his participation thereby frustrating his right to be present at all stages of the trial.
G. Factual allegations support the claim that the plaintiff was prevented from seeking and receiving the assistance of counsel throughout his six week period of detention in violation of his sixth amendment right to counsel.
H. The allegations also implicate plaintiff’s constitutional rights under the 14th amendment as the legislative history of the ADA indicates congressional intent to specifically remedy differential treatment of inmates in local jails. Accordingly, public entities do have the obligation under title II of the ADA to accommodate access to the most basic jail services for deaf pretrial detainees such as ensuring access to medical procedure information, access to the courts, and counsel. Failure to do so falls short of the guarantees of the 14th amendment.
I. Title II is also proportional because it only requires reasonable modification to services, programs, activities and nothing more.
J. There is an important distinction between being incarcerated in the state prison after conviction and temporary pretrial detention at the local jail because due process requires that a pretrial detainee not be punished. On the other hand, a sentenced inmate can be punished although that punishment may not be cruel and unusual. I would also add that it should be kept in mind that prisons are subject to Title II of the ADA per this case.
1. This case focuses on pretrial detention in the county jails.
2. Keep in mind, as mentioned above, prisons are also subject to the ADA.
3. Interesting that no constitutional violations were alleged in this case even though as the court discussed many of them may be present. Also, keep in mind, that many of the first 10 amendments to the U.S. Constitution have been incorporated into the 14th amendment. Therefore, a violation of one of the amendments that has been incorporated into the 14th amendment would also be a violation of the 14th amendment. That is important to know because per U.S. v. Georgia, a violation of the 14th amendment waives sovereign immunity.
4. Since showing that title II of the ADA is a proportional response means trying to find the most egregious things that could’ve been violated so that even if a person with a disability is in the rational basis class, the response is still proportional because of the rights (such as constitutional ones), being violated.
5. Since showing a proportional response means searching for the most egregious things that could have been violated, why not, on the plaintiff’s side, allege constitutional violations as well in addition to § 504 violations and ADA violations? Further, since the court lays out many constitutional violations, one wonders if the plaintiff will not now seek to amend the complaint to add various constitutional violations.
6. The proportional response exercise has to be gone through every time a person with a disability sues a state entity where they have not expressly consented to being sued for disability discrimination since, per Tennessee v. Lane, persons with disabilities classification vis a vis equal protection jurisprudence varies depending upon the facts. As mentioned in other blog entries of mine dealing with sovereign immunity, I am not aware of any other group of people whose classification for equal protection jurisprudence varies depending upon the facts.
7. It is never wise to engage in stereotyping. That is, don’t make the assumption that a TTY will allow a deaf person to effectively communicate because ASL is a visually-based language with a different grammatical structure than English and many deaf people are just not all that familiar with English, though quite a few certainly are. Also keep in mind, the effective communication regulations as well.
8. The impact of this case is potentially huge. I can’t tell you how many times you see ADA disputes involving prisons or jails. In any given week, I would say almost half of the cases that I see in my Lexis alert involve matters involving disability discrimination complaints against prisons or jails.


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In Hodge v. Neinstein, the Court upheld the Divisional Court’s certification of a class proceeding against Neinstein & Associates LLP, in which the plaintiffs claim that the firm’s accounts contravened the Solicitors Act.
In Bruff-Murphy v. Gunawardena, the Court of Appeal reviewed the law relating to the admissibility of expert opinion evidence and ordered a new trial after determining that certain expert evidence should not have been admitted.
Other topics covered included municipal law, construction contracts and arbitration agreements.
The appellant Allto Construction Service Ltd. (“Allto”) sued the respondent Aplus General Contractor Inc. (Aplus) for $163,202.98, the amount alleged to be owing under a subcontract to install a sewage system during the construction of a pool for the Heart Lake Conservation Area for the Toronto and Region Conservation Authority (the “Owner”). The respondent denied owing the amount claimed, pleaded that during its work Allto damaged an on-site irrigation system for which Aplus incurred repair expenses of $33,611.85, and asserted that Allto had overbilled Aplus $5,135.85 for additional risers which were included within its original scope of work. Aplus asserted a set-off and counterclaim in the amount of $38,747. The trial judge dismissed both the claim and the counterclaim. He stated there was no evidence at trial of invoices for the work performed by Allto and thus Allto had failed to meet its burden to satisfy the court it was owed the amount claimed.
Did the trial judge err in dismissing the claim?
Yes. The court found the trial judge had erred in principle when he concluded that the appellant had not proved it was owed the amount it claimed. The appellant’s witness had identified the purchase order issued by Aplus and had testified the work had been performed. The respondent’s witness did not contradict that evidence and confirmed the work had been performed without deficiencies. While Aplus denied the amount owing, it admitted the contract and Allto’s performance of the work. A witness had provided oral evidence that the amount claimed had not been paid. The court held this was sufficient to establish Allto’s outstanding claim. There was no requirement for any further proof through invoices.
The only material point of dispute was with respect to whether a sprinkler head in the irrigation system had been damaged, and the cost of its repair. The court held the respondent’s claim for set-off was not made out on the trial record, because Aplus’s documentation was suspect and the amount for the repair of a sprinkler head unreasonable. Moreover, the trial judge was entitled to interpret the admissions as he did – as admitting an entitlement to a back-charge but not a right to the amount the respondent claimed. The court held there was no basis for a set-off to the amount claimed by the appellant.
The respondent 1220510 Ontario Inc. lent $6,000,000 to the appellant Radium-O Developments Ltd. by way of a vendor take-back mortgage. The mortgage matured with the appellant not having paid the principal owing and was in default as of that date. The respondent started an application for the appointment of a receiver.
After some negotiations, the respondent made a settlement offer for a total amount of $6,162,950.45. This amount included principal, interest, three months’ interest compensation, receivership and legal fees, other fees and taxes. The payment had to be made in full by July 8, 2016. The offer contained a condition that the payment would be rejected and returned if there were any reservations, conditions, qualifications, or protests attached.
The appellant paid the full amount and asked for a discharge. The respondent discharged the mortgage. Later, the appellant disputed the amount charged, specifically the legal fees and discharge costs, before delivering a costs assessment notice and commenced a counter-application seeking to be relieved from paying the three months’ interest compensation and receivership costs.
The respondent moved to enforce the settlement and had its motion granted. The motion judge stated that the appellant could not keep the benefit of the discharge and protest after the fact how much was paid.
(1) Did the motion judge err in enforcing the settlement?
(2) Did the motion judge err in approving the costs and fees relating to the respondent’s steps in pursuit of the appointment of a receiver because they were in the nature of a penalty and therefore violated s 8 of the Interest Act?
(1) No. The settlement was a contract with an offer and explicit acceptance. The appellant received the consideration it bargained for – a discharge of the mortgage.
(2) No. The steps taken to appoint a receiver were entirely reasonable in light of the appellant’s default. Further, the three months’ interest compensation did not violate s 8 of the Interest Act, (see Mastercraft Properties Ltd. v. EL EF Investments Inc. (1993), 14 OR (3d) 519 (CA) and Irwin Mintz, In Trust v. Mademont Yonge Inc. and Paul Montgomery, 2010 ONSC 116).
The appellants operate hookah lounges in Toronto. Hookah lounges offer beverages and food for sale, but are known primarily as places to socialize or relax, and smoke hookahs, a form of water pipe. In 2015, the City of Toronto passed By-Law 1331-2015, which prohibits the use of hookah devices in connection with premises, vehicles, or things required to be licensed by the City for various purposes. The appellants brought an application challenging the validity of the bylaw. The application judge held that the City had the authority to pass the bylaw and that the by-law was valid.
(1) Did the application judge err in determining that the purpose of the by-law was the protection of health?
(2) Does the by-law infringe on the appellants’ property and civil rights to an extent not permitted by the City of Toronto Act or the common law?
(3) Did the application judge err in concluding that the by-law does not conflict with or frustrate the purpose of the Occupational Health and Safety Act?
(1) No. The court rejected the appellants’ contention that the primary effect of the law will be the closing of hookah lounges, which overwhelms the City`s health and safety motive when characterizing the purpose of the by-law. The court found the appellants are licensed by the City to sell food and may continue to do so. They also can continue to sell shisha. What they cannot do is to permit the smoking of hookah pipes on their premises. Although many hookah lounges will suffer economic harm as a result of the by-law, this effect is incidental. The court held there was ample support in the record of the application judge’s conclusion that the purpose of the by-law was the protection of public health and safety, which is specifically authorized by s 8(2) of the City of Toronto Act.
(2) No. The court rejected the appellants’ description of the legislation as “targeting and destroying their business property without compensation”. The court found the City of Toronto Act establishes broad by-law making authority which is not to be given the narrow construction advocated by the appellants. The by-law regulates business establishments licensed by the city and falls within the city’s by-law making authority.
(3) No. The court found there was no merit to the appellants’ submission that the by-law conflicts with or frustrates the purpose of the Occupational Health and Safety Act. The by-law was enacted to protect the health and safety of patrons as well as employees of businesses.
Finally, the court held it is not the court’s role to second-guess policy decisions made by elected municipal officials. The City of Toronto Act immunizes by-laws against judicial review for reasonableness and the application judge was limited to determining the legal validity of the city’s by-law. He made no errors in upholding the bylaw.
Facts: 6524443 Canada Inc. (“Brookfield”) and the City of Toronto (“Toronto”) are parties to a 99-year ground lease. The lease provided for the annual rent for the first period of 40 years. The rent for the second period was to be agreed between the parties, failing which either party could submit the issue to arbitration. Toronto provided notice of arbitration to Brookfield in 2011. The parties entered into an Arbitration Agreement in 2013. The arbitration Award was rendered in 2015. Brookfield filed a notice of appeal in the Superior Court which was denied, leading to this appeal.
(1) Did the motion judge err in refusing to consider the affidavit evidence?
(2) Did the motion judge err in concluding that the only right of appeal from the Award is on a question of law, with leave?
Regarding the standard of review where the interpretation of the Arbitration Agreement involves questions of mixed fact and law, the motion judge’s interpretation is reviewable on a standard of reasonableness.
(1) No. The affidavit evidence described the chronology and manner in which the Arbitration Agreement was prepared, and the parties’ competing views as to what was intended in relation to appeal rights. The motion judge correctly observed that evidence with respect to the factual matrix includes objective evidence of the background facts known to the parties at the time of execution of the contract, but does not include evidence of negotiations and of a party’s subjective intentions. To be sure, the affidavit did not offer evidence of the parties’ mutual objectives.
(2) No. First, the motion judge reasonably concluded that the Arbitration Agreement was intended to be a stand-alone agreement governing the arbitration and any rights of appeal from the Award. There was no need to refer back to the lease to interpret any of the terms of the Arbitration Agreement.
Second, both the lease and the Arbitration Agreement provide for the parties’ appeal rights to be governed by the Arbitration Act, 1991. If the parties intended to have broader rights of appeal, they would have so provided explicitly in the Arbitration Agreement.
The appellant and respondent are neighbours. The respondent alleged that the appellant was responsible for damages with regards to the flooding of her basement bathroom. The trial judge found in favour of the respondent and awarded her damages of $8,800.77 plus costs and disbursements of $1,515.12. On appeal to the Divisional Court, the judge dismissed her appeal and ordered costs against her in the amount of $3,000. The appellant then sought leave to appeal to the Ontario Court of Appeal and was denied.
The appellant now seeks reconsideration of the Ontario Court of Appeal’s decision denying leave to appeal based on the addition of new evidence. The new evidence suggests that the flooding of the respondent’s bathroom was the fault of back-up water from a sewer, and not from anything to do with the appellant. In addition, the appellant seeks to bring forth documents that suggest the respondent fabricated documents and invoices from contractors.
(1) Should the appellant be permitted to introduce new evidence?
(2) Did the Ontario Court of Appeal err in denying the appellant leave to appeal?
The appellant has failed to satisfy the test governing the admissibility of fresh evidence as outlined by the Supreme Court in R. v. Palmer,  1 S.C.R. 759, at p. 775. The test requires the satisfaction of the following four criteria: (i) the evidence could not have been adduced at trial; (ii) the evidence must be relevant in that it bears on a decisive or potentially decisive issue; (iii) the evidence must be reasonably capable of belief; and (iv) the evidence must be such that, if believed, it could reasonably, when taken with the other evidence adduced at trial, be expected to have affected the result.
Most of the fresh evidence that the appellant seeks to introduce has already been dealt with at trial. The possibility of the sewers causing the flooding was rejected by the trial judge. In addition, the appellant had an opportunity to challenge the accuracy of letters and documents and did not. The evidence she seeks to introduce today simply reiterates the allegations but presents nothing new to the argument.
The test for granting leave to appeal from a final decision of the Divisional Court is laid out in Sault Dock Co. Ltd. v. Sault Ste. Marie (City),  2 OR 479 (CA). Leave may be granted in cases that present an arguable question of law or mixed fact and law on the interpretation of legislation; the interpretation, clarification or propounding of a general rule or principle of law; the interpretation of a municipal by-law where the point in issue is a question of public importance; or the interpretation of an agreement where the point in issue involves a question of public importance: Sault Dock, at p. 481.
The appellant has failed to pass the test for granting leave to appeal because her appeal is largely fact-based and seeks mostly to impugn the trial judge’s assessment of the evidence.
The respondent Hodge was injured in a motor vehicle accident in 2002. She retained the appellants, Gary Neinstein and Neinstein & Associates LLP (“Firm”) and signed a contingency fee arrangement (“CFA”) with the Firm. It provided that the Firm’s legal fees would be equal to 25 per cent of the damages recovered on her behalf, plus partial indemnity costs (which would be no more than 40 per cent of the total recovery), plus disbursements.
Hodge signed a settlement, and the Firm, in calculating their legal fees, included the costs obtained as part of the settlement. She argued that this was a violation of s 28.1(8) of the Solicitors Act, RSO 1990, c S 15 (the “Act”), which sets out the circumstances in which a lawyer is permitted to enter into a CFA. She also alleged that the Firm charged interest on unpaid disbursements in violation of s 33(1) of the Act, which provides that a solicitor may only charge interest on the date one month after the bill is delivered.
Hodge brought a motion to certify a class proceeding against the Firm on behalf of all its contingency fee clients since October 2004. In her Amended Notice of Application, she was seeking, among other relief, a declaration that the Firm was in violation of the Act and had both breached its fiduciary duty to and breached its contracts with the class members, and an order that the Firm repay any amounts taken for costs in addition to a percentage of damages. She also alleged that the Firm charged disbursements that were excessive or improper.
The certification judge concluded that Ms. Hodge failed to satisfy the five-part test for certification under s 5(1) of the Class Proceedings Act, 1992, SO 1992, c 6 (the “CPA”). He found a free-standing, strict liability civil wrong for breach of ss. 28.1(8) and 28.1(9) of the Act, and he was satisfied that the Amended Notice of Application disclosed a cause of action under s. 23 and 25 of the Act, and for breach of fiduciary duty and breach of contract. He also concluded that there was an identifiable class, but stated that claims or defences of the class members did not raise common issues and even if they did, a class action was not the preferable procedure because it would inevitably lead to individual assessments of each class member’s claim, which could not be done at a common issues trial. The judge noted even if a breach of s. 28.1 could be said to be a free-standing strict liability civil wrong that would not overcome the common issues problem. However, the judge also found that solicitor-client privilege would not be an insurmountable obstacle if the proceeding was otherwise certifiable, citing at least one procedure which he believed could be undertaken to get around it.
On appeal, the Divisional Court allowed Hodge’s appeal, agreeing that there was a cause of action and that there was an identifiable class. However, the Divisional Court also found that the common issues requirement was satisfied, and that a class proceeding would be a preferable because judicial economy favoured a class proceeding, taking into account the access to justice barriers present for the class members to have their case heard. The Divisional Court also denied Hodge’s motion to amend her Amended Notice of Application to plead the tort of conversion, concluding that it added nothing of substance to the proceeding as currently drafted, meaning it was unnecessary to consider it. Additionally, the Divisional Court also agreed with the certification judge in finding that solicitor-client privilege would not be an insurmountable obstacle to certifying the proceeding. The Divisional Court certified the matter as a class proceeding.
On appeal to the Court of Appeal, the Firm argued that the application brought by Hodge should not have been certified as it failed to disclose a cause of action, fundamentally lacked in commonality and failed the preferable procedure requirement. In particular, the Firm argued that ss. 23-25 of the CPA precluded the possibility of a class proceeding against the Firm because they form a “complete code” and required individual assessments of client accounts. The Firm reiterated its solicitor-client privilege argument as a reason why the matter should not be certified as a class proceeding.
Hodge cross-appealed, arguing that the Divisional Court erred by denying her leave to amend her Amended Notice of Application to plead the tort of conversion and failing to certify further common issues.
(1) Issue on appeal: Did the Divisional Court err in certifying the class proceeding?
(a) Did Hodge’s claim under s 28(1) of the Act disclose a cause of action satisfying s 5.1(a) of the CPA?
(b) Were there common issues in the action?
(c) Is the class proceeding a preferable procedure?
(b) Failing to certify further common issues?
Holding: Appeal dismissed, and cross-appeal allowed in part.
(1) No. The Court of Appeal found that the Divisional Court was correct in finding a cause of action, that the common issues requirement was satisfied on the basis of 18 common issues in the class, and that the class proceeding was the preferable procedure.
(a) Yes. The Court stated that the Divisional Court correctly concluded that it was not plain and obvious that a cause of action relying on s 28.1 could not succeed, stating that it was not plain and obvious that an application under ss. 23-25 of the Act is not available to review the CFAs at issue in this application.
The Court reviewed the test under s 5(1)(a) of the CPA – finding that it was the same as the test on a motion to strike for no reasonable cause of action per Pro-Sys Consulting Ltd. v. Microsoft Corp., 2013 SCC 57,  3 S.C.R. 477, at para. 63. The test is whether, assuming the facts pleaded to be true, it is plain and obvious that the claim has no reasonable prospect of success per R. v. Imperial Tobacco Canada Ltd., 2011 SCC 42,  3 S.C.R. 45, at para. 17. Furthermore, whether the cause of action requirement is met is reviewable on a correctness standard of review per Attis v. Canada (Minister of Health), 2008 ONCA 660, 93 OR (3d) 35, at para. 23.
The Court then applied the test to find that it was not plain and obvious that a cause of action relying section 28.1 of the Act had no reasonable prospect of success. In doing so, the Court distinguished Seneca College v. Bhadauria,  2 S.C.R. 181; Frame v. Smith,  2 S.C.R. 99; Canadian Alliance of Pipeline Landowners’ Assn. v. Enbridge Pipelines Inc., 2008 ONCA 227, 237 O.A.C. 200, which cites Canada v. Saskatchewan Wheat Pool,  1 S.C.R. 205.
In Seneca College, the Supreme Court considered Ontario’s Human Rights Code, RSO 1970, c 318, and concluded that it foreclosed any civil action based directly upon a breach of its terms or the invocation of any public policy expressed in the Code. In Frame, the Supreme Court similarly concluded that permitting a father to sue the mother and her present husband for frustrating court-ordered access, either by creating a tort or recognizing a fiduciary duty arising out of a court order, “may well do violence to the comprehensive statutory scheme [of the Children’s Law Reform Act] provided by the Legislature” at p. 114.
The Court found that Seneca College, Frame and Canadian Alliance were arguably distinguishable for two reasons. The first was that section 28.1 is unique in one important respect: section 28.1(9) specifically provides that a CFA that is subject to approval under subsection (8) is not enforceable unless it is so approved. Section 28.1(9) provides a consequence for the statutory breach. Much of the relief Ms. Hodge seeks flows from that provision – the statutorily-prescribed consequence of the breach – and not the breach itself.
The Court said that the claimants in Seneca College, Frame and Canadian Alliance did not seek relief based on a statutorily-provided consequence of a breach of statute. Secondly, the declaration that Hodge was seeking was in respect of rights under an agreement, making it arguably different from an action based on breach of a statutory term, as in Seneca College. The Court acknowledged that the Act does not expressly provide that a client may pursue civil remedies where a CFA that is subject to approval under subsection (8) is “not enforceable unless it is so approved”, but said that it was arguable whether express language was necessarily required despite comments in Canadian Alliance that might be read as suggesting otherwise.
Finally, the Court stated that it was at least arguable that an assessment under s 24 of the Act was not the only remedy available where a CFA was unenforceable pursuant to s. 28.1(9) of the Act, and that it was also argued that the Court of Appeal’s inherent jurisdiction in matters relating to the regulation of lawyer’s accounts suggests that ss. 23-25 of the Act may not constitute a complete code.
The Court accepted that Hodge had adequately pleaded a cause of action for a breach of fiduciary duty. The Court also found that the Divisional Court had erred in finding that Hodge had met the test for show a cause of action in breach of contract because her pleading was deficient, but granted her leave to amend her notice of application. The Court also said that while the Firm had a strong argument that a contract claim would be caught by ss. 23-25 of the Act, the argument was not so strong as to be plain and obvious.
(3) It is not essential that the class members are identically situated vis-à-vis the opposing party.
The Court stated that at the certification stage, the factual evidence goes only to establishing whether the questions are common to all the class members and that while there must be “some basis in fact” that the issues are common, the test “does not require that the court resolve conflicting facts and evidence at the certification stage”, which the court is ill equipped to do at that stage. Even a significant level of difference among the class members does not preclude a finding of commonality. If material differences do emerge, the court can deal with them at that time.
The Court agreed with Firm that common issue 3, was not a proper common issue, in finding that, whether the Firm actually took amounts arising from costs in an award or settlement contrary to the Act should be characterized as an individual issue. However, the Court stated that did not affect its conclusion that the Divisional Court was correct in certifying this proceeding because the remaining common issues would be sufficient to meet the certification criteria.
(c) Yes. The Court of Appeal found that the Divisional Court was correct in certifying the class proceeding on the basis that it was a preferable procedure. First, the Court went over the test, stating that in the context of the preferability requirement, the representative plaintiff must show some basis in fact (1) that a class proceeding would be a fair, efficient and manageable method of advancing the claim, and (2) that it would be preferable to any other reasonably available means of resolving the class members’ claims per AIC v. Fischer, 2013 SCC 69,  3 S.C.R. 949, at para. 48. They noted that the preferability requirement is to be conducted through the lens of the three principal goals of class actions, namely judicial economy, behavior modification, and access to justice, citing AIC, at para. 22 and Hollick v. Toronto (City), 2001 SCC 68,  3 S.C.R. 158, at para. 27, for this proposition. Finally, the Court stated that a certification judge’s preferability analysis is entitled to considerable deference on appeal. A reviewing court should intervene only where the certification judge has made a palpable and overriding error of fact or otherwise erred in principle per Pearson v. Inco Ltd. (2005), 205 O.A.C. 30 (CA), at para. 43.
In applying this analysis, the Court stated that the issue raised respecting solicitor-client privilege was not a basis for refusing certification. After reviewing the law on solicitor-client privilege set out by the Supreme Court of Canada in Blank v. Canada (Minister of Justice), 2006 SCC 39,  2 S.C.R. 319, and Minister of National Revenue v. Thompson, 2016 SCC 21,  1 S.C.R. 381, said the Court stated that it was not a reversible error for the Divisional Court to identify one way in which solicitor-client privilege could be avoided as a problem and leave it to the case management judge to work out the particulars. The Court of Appeal stated that this should not be a bar because the court retains the power under 10(1) of the CPA to decertify the class proceeding if it appears to the court that the certification criteria are no longer satisfied.
The Court of Appeal also dismissed the Firm’s other arguments, finding that the Divisional Court made no error in finding that individual assessments were beyond the reach of the class with a class proceeding being the only realistic opportunity for their claims to be advanced, the Court found that there was no error in behaviour modification towards the Firm and the Bar at large helping to make the proceeding preferable, and that the individual limitation issues in each of the claims would present an obstacle.
(a) No. It was open for the Divisional Court to decline to consider the proposed amendment to add a cause of action. However, if it declined to consider the proposed amendment on its merits, it should have made clear that its decision that doing so did not bar Ms. Hodge from bringing her motion to amend before the case management judge. The Court stated that the Divisional Court erred in principle by dismissing the motion without focusing on whether the Firm was afforded procedural fairness and whether the proposed amendment would cause prejudice to the Firm.
(b) Yes. The Divisional Court should have certified two additional common issues.
The first was whether the conduct of the Firm – in allegedly failing to disclose information required by the Act and the Regulation in its CFAs and taking as part of their fees amounts arising from awards or settlements for costs – breached fiduciary duties to class members. The Court said that there was some basis in fact for asking whether the taking of costs contrary to the Act constituted a breach of fiduciary duty by the Firm, such that this is a proper common issue. The Court also noted that the record on appeal was replete with examples of final accounts showing party-and-party costs payable to the Firm, in addition to a percentage of the award or settlement, and the only evidence of the Firm not taking such costs was that of someone who it appears will opt out of the class proceeding. However, the Court stated that the issue of whether the Firm actually took to the amounts was an individual issue.
The second was whether there was entitlement to punitive damages. The Court said that entitlement to punitive damages could be certified as a common issue in a proper case, and that whether a defendant has breached a fiduciary duty engages the same kind of fact-finding that will be necessary to determine whether punitive damages are justified per the Supreme Court of Canada’s decision in Rumley v. British Columbia, 2001 SCC 69,  3 S.C.R. 184, at para. 34. The Court said that if it were found that the Firm breached its fiduciary duty to its clients, and disgorgement – in whole or in part – was ordered, it would be open to the trial judge to consider whether he or she was in a position to determine entitlement to and the quantum of punitive damages, consistent with the principles in Whiten v. Pilot Insurance Co., 2002 SCC 18,  1 S.C.R. 595. If the Firm successfully advanced a quantum meruit claim, the trial judge could determine punitive damages only after individual quantum meruit assessments.
The appellant was hit by the respondent while stopped in her motor vehicle. She alleged that she suffered multiple injuries, both physical and psychological. She sued the respondent, who admitted liability. The sole issue in the jury trial was what damages, if any, she suffered. The plaintiff called a number of physicians who had either treated or examined her. The consensus among them was that she suffered in the manner complained of, and that the cause of her suffering was the motor vehicle accident. The defence called two witnesses, one of whom was the expert witness whose testimony was ultimately at issue on this appeal.
The appellant objected to the admission of that expert’s testimony on two grounds. First, because his report was an attack on the appellant’s credibility. Second, he was biased. On the first ground, the appellant submitted that the expert report’s repeated references to inconsistencies in the medical assessment of the plaintiff violated the rule in Browne v. Dunn, given that the plaintiff had no opportunity to explain these inconsistencies.
On this second ground, the appellant submitted that she should be permitted to cross-examine the expert witness on findings made in another court case and two arbitrations that he was not an independent witness. The trial judge ruled against the appellant on both these grounds.
The trial judge then ruled that the expert witness could not testify on certain sections of his report. The relevant sections were primarily where the expert witness was critical of the reliability of the conclusions reached by other doctors examining the appellant. The trial judge also made clear that the expert witness should not testify about the appellant’s credibility.
However, the expert witness effectively did exactly that in his testimony, testifying that in his opinion, she did not actually develop any of the health problems she claimed.
After closing submissions, the trial judge gave his charge to the jury. No special instruction regarding the expert witness’s testimony was requested, nor did the trial judge instruct the jury regarding the duty of expert witnesses. The trial judge also did not raise any concerns with respect to the substance of the expert witness’ testimony or his independence.
The jury returned with a verdict assessing general damages at $23,500 and rejecting all other heads of damages, including special damages, future care costs and past and future income loss.
(1) Did the trial judge err in not permitting the appellant to cross-examine the respondent’s expert witness on prior court and arbitral findings made against him?
(2) Did the trial judge err in qualifying the respondent’s expert witness as an expert and/or in not intervening or taking steps to exclude his testimony?
(3) Did the respondent violate the rule in Browne v. Dunn?
(1) No. In the present case, the prior comments would have been of no assistance to the jury without an understanding of their factual foundation. That necessary context would only have served to divert the jury from the task at hand and convert the trial into an inquiry regarding the reliability of the expert witness’s testimony in the three other proceedings. Thus, the Court held that the trial judge did not err in prohibiting this line of cross-examination.
(2) Yes. The trial judge was entitled to deference on the first part of the test for admissibility of expert evidence, articulated in R. v. Mohan, which established a low bar for threshold admissibility. While the trial judge’s ruling on this point may have been highly debatable, he was within his authority to decide as he did.
On the second part of the test for admissibility, however, the trial judge failed to properly fulfil his gatekeeper function and engage in a cost-benefit analysis of the expert witness’s testimony that weighed its probative value against its prejudicial effect. From a review of the record, the Court of Appeal found that it was abundantly clear that the prejudicial effect of the expert witness’s testimony far outweighed any probative value. The risk was palpable that the expert witness would fail to remain impartial and would instead act as an advocate for the defence.
(3) In light of the answer to Issue (2), the court deemed an answer to Issue (3) unnecessary.
Keywords: Criminal Law, Murder, Attempted Murder, R. v. Jack (1993), 88 Man. R. (2d) 93 (C.A.), aff’d  2 S.C.R. 310, R. v. Maciel (2007), 219 C.C.C. (3d) 516, leave to appeal refused  3 S.C.R.

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As under MiFID II / MIFIR, the term "retrocession" is not used in the FinSA or in the draft ordinance on Financial Services (FinSO). Both FinSA and draft FinSO use the term "third party compensation". And as with the inducements under MiFID II / MiFIR, it means any monetary and non-monetary benefit received by a person because he or she provides a financial service to a third party, such as managing that third party's assets, offering it a financial product or advising it on financial matters. This includes in particular brokerage fees, commissions, kick-backs, discounts or other pecuniary benefits. The understanding is very broad.
The understanding of retrocessions is narrower in the so-called transparency directive issued by SFAMA (Guidelines on Duties Regarding the Charging and Use of Fees and Costs of 22 May 2014). According to N 16 thereof, retrocessions "are deemed to be payments and other soft commissions paid by fund management companies, SICAVs and SICAFs and their agents for distribution activities in respect of fund units". However, this understanding, which is reduced to the sale of fund units alone, cannot be applied to FinSA, as by definition FinSA has a wider scope of application than just the sale of fund units.
A typical feature of retrocessions is that they are not paid to the recipient of the financial service but to the provider of the financial service. This illustrates the problem of retrocessions: they can make the recipient, who owes his client the best possible execution (art. 18 FinSA), to focus his action on obtaining retrocessions rather than on the interests of the client.
The scope of retrocessions is governed by art. 26 FinSA and art. 27 draft FinSO. These provisions stipulate that financial service providers may accept compensation from third parties in connection with the provision of financial services only if (i) they have expressly informed the customer in advance of the compensation and the customer has waived it, or (ii) they pass on the compensation in full to the customer.
Either he informs the client in advance of the retrocessions and can retain them if the client waives the surrender on the basis of this information.
Or the financial services provider may pass on the retrocessions, in which case it does not have to inform the customer of the retrocessions in advance.
The customer must be informed of the nature and extent of the compensation and must be provided before the financial service is performed.
Retrocessions are not known in advance, particularly in the case of continuing obligations such as asset management agreements or investment advisory agreements with a long-term focus. In this case, the client must be informed about the calculation parameters and the bandwidths before concluding the contract. This information must be so detailed that, if the client does not know exactly how high the retrocessions are, he has at least the parameters to calculate the amount. Because the waiver of retrocessions is only valid if the customer knows or can know what he waives.
Retrocessions that cannot be released must be disclosed to the client as a conflict of interest (art. 29 draft FinSO). This also includes non-monetary gifts such as invitations to opera performances or to luxury seminars.
The original intention of the Federal Council thus became law. In its message on FinSA / FinIA, the Federal Council stated that it had decided on the following direction: "Full transparency with regard to all advantages received from third parties, but no general or partial ban on compensation such as retrocessions, brokerage fees, etc". (point 1.2 of the Message).
This regulation according to art. 26 FinSA and 29 draft FinIA is by no means revolutionary.
It corresponds to the civil law applicable under art. 400 Swiss Code of Obligations, as the Federal Supreme Court has recently confirmed several times (see above all BGE 138 III 755, 137 III 393, 132 III 460 etc.). This is to be welcomed and is therefore in line with civil law and supervisory law.
The Collective Investment Schemes Act (CISA) goes one step further. Pursuant to art. 21 paragraph 2, licensees under CISA (i.e. in particular fund management companies and asset managers) may not retain remunerations received in connection with the acquisition and sale of assets and rights, but must credit them to the fund. This is necessary because the fund itself cannot waive the release of retrocessions, since the only person acting on its behalf is the fund management company, which is actually receiving the retrocession. See also paragraphs 23 - 26 Code of Conduct of SFAMA.
Like the CISA, the Swiss Federal Act on Occupational Pensions and its second implementing ordinance (OPO 2) go one step further than the FinSA. Art. 48k OPO rules that persons entrusted with the management, administration or asset management of a pension fund must "compulsorily" (!) surrender to the institution all pecuniary benefits that they receive in excess of the agreed compensation. The pension fund cannot, therefore, waives the right for the release of retrocessions.
WHAT SHOULD THE FINANCIAL SERVICES PROVIDER DO?
This raises the question of what the financial services provider under FinSA should do with regard to retrocessions.
If the financial services provider manages the assets of pension funds or collective investment schemes, it must credit retrocessions to the institution or the fund. A deviation from this is not permitted.
The financial service provider may pass on the retrocessions in full to its customers. This may be arithmetically complex, but it is in any case in compliance with the law.
If the financial services provider wants to retain the retrocessions, it needs the customer to waive the obligation to surrender them. This means that the customer either knows the exact amount of the retrocessions or knows the parameters according to which the retrocessions are calculated.
If, on the other hand, the financial services provider works for a pension fund or a collective investment scheme, retrocessions must be issued.
The next issue of FIDLEG SOLUTION – News will deal with the criminal consequences of retrocessions not being treated in accordance with the law.


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Dan Morton is a 1982 graduate of Duke University and 1985 graduate of the University of North Carolina School of Law. Mr. Morton was admitted to the North Carolina Bar in 1985 and his primary practice areas are insurance defense, insurance coverage, civil litigation, employment law and construction law. Mr. Morton is a member of the North Carolina Association of Defense Attorneys, the Defense Research Institute and the National Institute of Trial Advocacy.
Pyco Supply Co. v. American Centennial Insurance, 85 N.C. App. 114, 354 S.E.2d 360 (1987), reversed 321 N.C. 435, 364 S.E.2d 380 (1988); Bailey v. LeBeau, 79 N.C. App. 345, 339 S.E. 2d 460, reversed, 318 N.C. 411, 348 S.E. 2d 524 (1986); Maring v. Hartford Cas. Ins. Co., 126 N.C. App. 201, 484 S.E.2d 417 (1997). Revels v. Robeson County Bd. of Elections, 167 N.C. App. 358, 605 S.E.2d 219 (N.C. Ct. App. 2004); Lightner v. City of Wilmington, N. Carolina, 498 F. Supp. 2d 802 (E.D.N.C. 2007) aff'd sub nom. Lightner v. City of Wilmington, N.C., 545 F.3d 260 (4th Cir. 2008).

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