19 October 2011

Court of Appeal Releases Decision on Standard of Reasons for Judgment

In a new decision, Shannon v. Shannon, the Court of Appeal discusses the adequacy of trial judges' reasons for judgment as a ground of appeal. "Reasons for judgment" are a judge's written decision about the facts of a case, the law which applies to the issues in dispute, and the judge's disposition of the issues in dispute by applying the law to the facts.

A judge's decision at trial can be appealed, however the appeal must establish an error of law or a gross misapprehension of the evidence to succeed; you don't get to appeal a decision just because you don't like it. In Shannon, the appellant claimed that the trial judge erred in law by "failing to provide adequate or sufficient reasons" for his valuation of an asset, and that in the absence of more fulsome reasons she could not assess whether the judge had made a mistake in his judgment.

The Court of Appeal dismissed the appeal after a thorough review of the applicable law. These are the highlights of the court's analysis, quoted directly from the decision:
> A trial judge has a duty to give adequate or sufficient reasons for his or her decision. Failure to give adequate or sufficient reasons for judgment is an error of law. (Willick v. Willick, [1994] 3 SCR 670; F.H. v. McDougall, 2008 SCC 53)

> The function of reasons for judgment is to explain what the trial judge has decided and why he or she reached that decision. (R. v. Morrissey (1995), 22 O.R. (3d) 514 (C.A.); R. v. R.E.M., 2008 SCC 51)

> Reasons for judgment should demonstrate "a logical connection between the 'what' – the verdict – and the 'why' – the basis for the verdict," when they are read as a whole in the context of the evidence and the live issues at trial, and the submissions of counsel. (R.E.M.)

> In the civil context, the duty to give reasons is to:
  1. justify and explain the result;
  2. tell the losing party why he or she lost;
  3. provide for informed consideration of the grounds of appeal; and,
  4. satisfy the public that justice has been done.
(R. v. Walker, 2008 SCC 34)

> An appeal court cannot intervene merely because it believes the trial judge did a poor job of expressing herself. Nor is a failure to give adequate reasons a free standing basis for appeal. ... Nor are reasons inadequate because in hindsight, it may be possible to say that the reasons were not as clear and comprehensive as they might have been. (F.H.)

> There is no free-standing right of appeal on the adequacy or sufficiency of a judge's reasons. Moreover, even where the logical connection between the evidence and the decision cannot be discerned ... appellate intervention will not be justified if the record itself permits meaningful appellate review. (R. v. Gagnon, 2006 SCC 17)
In Shannon, evidence about the value of the asset was available from the record of the Supreme Court proceedings in the form of an expert's appraisal and a rebuttal report prepared by another expert. Said the Court of Appeal:
"It is evident the trial judge was faced with a wide range of potential share values, calculated under two different valuation approaches... He understandably recognized his decision as to the value of the shares must be arbitrary to some degree, given the uncertainty associated with the Company's future. In choosing a fair market value of $500,000, it may be inferred that he began his analysis with [X]'s valuation of the shares as it was the only opinion before the court on that issue. However, he also appears to have preferred [Y]'s more optimistic portrayal of the Company's potential. This is evident in his finding that the Company would not be sold and had value as an ongoing concern. On the other hand, it is also apparent that he accepted that the unique features of this business and the uncertainties in the ... market limited its marketability and therefore its value as a going concern. In my view, the valuation of $500,000 takes into account these competing considerations. Thus while the 'why' for the trial judge's valuation of the shares could have been expressed more clearly, in my view it is adequately explained when examined in the context of the evidentiary record.

"The reasons for judgment in this case are to be distinguished from those considered by the Court in Crepnjak v. Crepnjak, 2011 BCCA 177... In Crepnjak, the necessary findings to support the chambers judge's conclusions could not be discerned from his reasons or the evidentiary record and, accordingly, the appeal was allowed and a new hearing ordered."
To boil this all down, the judge at trial has a duty to provide reasons for judgment which allow the parties and the general public to understand her decision and why she reached that particular decision. An appeal based on the insufficiency of reasons for judgment will only succeed where the reasons for a decision cannot be discerned from both the reasons for judgment and the record of the trial proceedings.

1 comment:

  1. Dear John-Paul,

    Thank you for taking the time to explain this decision on standard of reasons for judgment in a clear, concise and most importantly, understandable manner.

    As a lay-person, I always appreciate efforts by professionals such as yourself to educate the general public on matters that can be difficult to comprehend. Keep up the great work!

    James Rha

    ReplyDelete