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Corporations - Appeals. Provincial Women’s Softball v. Mississauga Majors
In Provincial Women’s Softball v. Mississauga Majors (Ont Div Ct, 2025) the Ontario Divisional Court dismissed an appeal [under NFPCA s.192], this brought against a decision that granted a baseball association's relief "under the Ontario Not-for-Profit Corporations Act, 2010" when they sought membership in another association.
Here the court considers the textual interpretation of not-for-profit corporate bylaws, which here turned on the appellate SOR issue of whether they involved extricable issues of law, or mixed fact and law:Standard of Review
[25] The PWSA says that the standard of review ought to be correctness as the central issue on this appeal is the interpretation of the PWSA by-laws. In this respect, the PWSA relies on a decision of the Alberta Court of Appeal which held that the by-laws of condominium boards are “more akin to laws and regulations passed by a legislative body than contractual provisions”: Dunn v. Condominium Corporation No. 042 0105, 2024 ABCA 38, at para. 15 – 18. The Majors argue that the applicable standard of review is palpable and overriding error given that this case involves the application of the PWSA’s by-laws, which are contractual in nature, within a particular factual context.
[26] I am satisfied that the applicable standard of review in this matter is palpable and overriding error. The application judge was required to interpret the Act, the PWSA’s by-laws, and its operating rules and to apply those interpretations to a specific set of facts. I agree with the respondent that on this point the present case is indistinguishable from the decision of this court in Chu v. Scarborough Hospital Corporation (2007), 2007 CanLII 33757 (ON SCDC), 228 O.A.C. 131 (Div. Ct.) where Linhares de Sousa J. wrote as follows (at paras. 5 – 6):[The application judge’s] decision involved a legal interpretation of the Corporations Act as well as the Hospital’s By-Laws and the application of that interpretation to the very specific facts of this case. The questions of law are not readily extricable from the questions of fact and hence the standard of review should be that of palpable and overriding error. [27] The application judge in Scarborough Hospital was required to interpret the by-laws of the hospital and he did so in light of how those by-laws had been interpreted and applied in the past by the hospital board. The ultimate question was whether that interpretation had been reasonable (see paras. 9 – 15). In other words, it was not an exercise of law alone. In the present case, in an effort to support their respective interpretations of the by-laws, both parties relied on evidence of how the PWSA by-laws had been applied in the past. They then applied their view of the meaning of the by-laws to the facts of this case and urged their positions on the application judge. In other words, this too was not an exercise of law alone.
[28] The application of a deferential standard of review is supported by the fact that the by-laws of a not-for-profit corporation are “essentially contractual in nature”: Bhandal v. Khalsa Diwan Society of Victoria, 2014 BCCA 291, at para. 27. See also, Canadian Federation of Students v. Cape Breton University Students’ Union, 2015 ONSC 4093, at para. 115; Re London Humane Society, 2010 ONSC 5775, at para. 16. Their interpretation is therefore subject to the principles which govern the interpretation of contracts: that the by-laws be read as a whole and in context and be applied in a “practical common-sense way”: Canadian Federation of Students, at para. 116. This means that evidence of the “surrounding circumstances” is admissible and may be important to the court’s ultimate conclusion: Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, at paras. 59 – 61. The inquiry, then, is one of mixed fact and law. Moreover, it is clear that the application judge in the present case engaged in just such a mixed inquiry when interpreting the PWSA’s by-laws.
[29] The PWSA attempts to set this case apart from the authorities and reasoning to which I have referred on the basis that the Majors were applying for membership, had not yet become members, and therefore were not parties to the contract which the by-laws represent. They could not, then, invoke the right to apply the contract, or rely on the principles of contractual analysis.
[30] I cannot accept this argument. First, the appellant’s position on this point leads to the possibility both that a different standard of review might apply depending on whether the moving party was a member or an applicant for membership, and that the interpretation of the by-laws might be different depending on the same distinction given that different principles apply to statutory and contractual interpretation.
[31] More importantly, though, the obligation of the PWSA when it was considering the Majors’ application was to apply the by-laws properly at least in part for the benefit of its existing members, in order to fulfill the aims and objectives of the PWSA as they are described in the by-laws. Some of those members participated in the Majors’ membership hearing and they are parties to the “contract” which the by-laws represent. The application judge’s exercise was similar: to determine whether the by-laws had been applied properly in light of the wording of the by-laws and the surrounding context. In all these circumstances, I agree with the Majors that the fundamental nature of the by-laws, and of the interpretive exercise in this case, was contractual in nature even if the Majors were not members – or parties to the contract – when they applied.
[32] For these reasons, I am of the view that the standard of review to be applied in this case is palpable and overriding error. . Morgan Investments Group Inc. v. Adi Development Group Inc.
In Morgan Investments Group Inc. v. Adi Development Group Inc. (Ont Div Ct, 2025) the Ontario Divisional Court granted a motion to quash an appeal, here argued that it was in the wrong court on final versus interlocutory grounds.
Here the court considers appeals under OBCA s.255 ['Appeal']:[19] On the second issue, the affiliated lenders submit that even if the Order is interlocutory, they have a right of appeal by virtue of s. 255 of the OBCA, which provides that an appeal lies to this Court from an order made under the OBCA.
[20] It has long been established that s. 255 does not provide an appeal as of right from an interlocutory decision under the OBCA.
[21] In the seminal case of Watkin v. Open Window Bakery Ltd. (1996), 1996 CanLII 11788 (ON SC), 28 O.R. (3d) 441 (Div. Ct.), this Court considered the issue in like circumstances and held that s. 255 applied to final orders only. We reiterate the following observations from Watkin. The list of possible orders that can be made under the OBCA is endless. The affiliated lenders’ position would amount to innumerable appeals as of right from any interlocutory order made under the OBCA, clogging this Court. This would also cause potential disruption of the ongoing commercial proceedings.
[22] Since Watkin, multiple courts have confirmed that leave to appeal is required even if the OBCA (or like statutes) is invoked. Those cases need not be listed here. The affiliated lenders rely on a brief obiter phrase in a single decision, specifically Foglia v. Grid Link Corp., 2024 ONSC 588 (Div. Ct.).
[23] There are multiple decisions in Foglia, which make it clear that the decision at issue was final. First, there is the Court of Appeal decision at 2023 ONCA 560, quashing an appeal to that Court. The Court of Appeal held that the order at issue was a substantive order and the appeal was to the Divisional Court. The final nature of the order in Foglia is also apparent in the appeal decision of this Court on the merits of that appeal, at 2024 ONSC 5715.
[24] The affiliated lenders rely on an endorsement of this Court before the appeal hearing, which confirmed that leave to appeal was not required. As a final order, leave to appeal would not be required. That short endorsement includes the sentence, “Given the plain wording of s. 255 of the [OBCA], leave to appeal the decision on the motion is not required”: 2024 ONSC 588, at para. 8. Since the order at issue in Foglia was final, we do not agree that this sentence, or the endorsement as a whole, stands for the proposition advanced by the affiliated lenders. If read more broadly, it is obiter and does not displace considerable established jurisprudence requiring leave if an order is interlocutory. . Lagana v 2324965 Ontario Inc.
In Lagana v 2324965 Ontario Inc. (Div Court, 2023) the Divisional Court considered (and partially allowed) an appeal of a s.253 OBCA application to "enforce his right as a shareholder to receive audited financial statements" (an 'accounting'):[9] The parties disagreed on the scope of the order. Following the application judge’s final order, the appellants brought this appeal, which although styled in the Court of Appeal, was argued in the Divisional Court. Section 255 of the OBCA provides: “An appeal lies to the Divisional Court from any order made by the court under this Act. R.S.O. 1990, c. B.16, s. 255.” . Kong v. Au
In Kong v. Au (Div Court, 2023) the Divisional Court considered a situation where a party sought to hear corporate oppression appeals respecting two corporations, one under the OBCA and the other under the CBCA, together - despite the fact that they have different appeal routes:[2] There is a jurisdiction issue regarding this appeal. One of the two companies at issue is an Ontario corporation – 1802606 Ontario Inc – incorporated under the Business Corporations Act, R.S.O. 1990, c. B.16 (“OBCA”). The other company – Taknology (Canada) Inc. – is a Canada Business Corporations Act, R.S.C. 1985, c. C-44 (“CBCA”). The appeal materials seek to pursue an appeal under both statutes and seek interrelated remedies.
[3] The appeal routes under the above statutes are different. An appeal under the OBCA is to the Divisional Court. However, an appeal under the CBCA is to the Court of Appeal.
[4] The Court raised this jurisdiction issue with the parties last week. It was not raised by either side of this dispute prior to that time.
[5] This Court has the discretion to transfer a matter that has been brought in the wrong court to the proper court, under s. 110 of the Courts of Justice Act, R.S.O. 1990, c. C.43. Relevant factors include the merits of the proposed appeal, whether the respondents will suffer undue prejudice as a result of further delay while the appeal is waiting to be heard, and whether the appellant moved expeditiously after becoming aware that jurisdiction was in dispute.
[6] In this case, we must also consider the issue of divided jurisdiction. The issues on this appeal relate to both companies and are intertwined. The Divisional Court cannot hear or transfer both appeals. However, the Court of Appeal has jurisdiction, under s. 6(2)(3) of the Courts of Justice Act, to transfer a matter already commenced in the Divisional Court if an appeal in the same proceeding lies and is taken to the Court of Appeal. Upon transfer of the CBCA appeal to the Court of Appeal, the appellant could seek an order from the Court of Appeal under s. 6 and potentially have the whole matter considered together. The appellant intends to do so. That relief is not available in the Divisional Court.
[7] Having considered the submissions and cases put forward by both sides of this dispute, we conclude that the CBCA appeal should be transferred to the Court of Appeal. The relevant statutory provisions regarding appeal rights were expressly stated in the appeal materials but neither counsel identified the issue, accounting for most of the delay. With respect to prejudice, the respondents rely on their legal costs incurred and the costs order below being automatically stayed. The legal costs can still be claimed in the ongoing proceedings. We are not persuaded that there is significant prejudice. As for the merits, they should be heard.
[8] The CBCA appeal is therefore transferred to the Court of Appeal. The OBCA appeal is adjourned to permit the appellant to seek relief from the Court of Appeal under s. 6 of the Courts of Justice Act. . Bernier v. Kinzinger
In Bernier v. Kinzinger (Div Court, 2023) the Divisional Court considered the appeal route for OBCA appeals:7. Jurisdiction over this appeal lies in the Divisional Court pursuant to s. 255 of the OBCA. An “appellate standard of review” applies. Questions of law are reviewable on a correctness standard. Questions of fact are reviewable on the standard of palpable and overriding error. Mixed questions of fact and law are reviewable on the deferential standard that applies to questions of fact, except to the extent that they disclose an extricable question of law, which is reviewable on a correctness standard. See: Housen v. Nikolaisen, [2002] 2 SCR 33. A trial court’s findings respecting contractual terms are generally questions of fact or of mixed fact and law reviewable on a deferential standard: Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, para. 50.
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