Revisiting leave: The Ontario Court of Appeal brings fresh clarity to a familiar test

The Divisional Court sits at a busy crossroads in Ontario’s justice system. It hears all judicial reviews in Ontario, interlocutory appeals, and statutory appeals in a broad range of areas, from Ontario Energy Board decisions to decisions made under the Ontario Business Corporations Act. There is no automatic right to appeal from the Divisional Court to the Court of Appeal for Ontario. In Knauff v. Ontario (Human Rights Tribunal)¹, the Court of Appeal clarified a longstanding test governing when it will grant leave to appeal from the Divisional Court. While the decision does not break new ground, it streamlines the analysis, providing a more straightforward framework for deciding whether leave is warranted.

What you need to know

• The test for leave has not fundamentally changed. The Court of Appeal reaffirmed the core of the longstanding Sault Dock test while eliminating features that had caused confusion.
• Leave turns on two components: arguability and public importance. Arguability asks whether there is a genuine issue for appeal. Public importance considers both the persons who may be affected by the issue and the extent to which its resolution would advance Ontario jurisprudence. There is no longer a separate category of “special circumstances” that may warrant leave.
• The same leave framework applies regardless of the Divisional Court’s jurisdiction. The Court of Appeal clarified that the same test applies whether the Divisional Court exercised original jurisdiction (i.e., in hearing a judicial review) or appellate jurisdiction (i.e., a statutory appeal from a court or tribunal).

Background

The Sault Dock framework

For more than 50 years, Re Sault Dock Co. Ltd. and City of Sault Ste. Marie² has provided the test for obtaining leave to appeal from the Divisional Court. At its core, the inquiry asked whether the issue raised a question of general public importance warranting resolution by the Court of Appeal³. Sault Dock identified four categories of cases raising an arguable question that might satisfy this standard. The Court also left room for leave to be granted where “special circumstances” justified it.

Revisiting Sault Dock

In 2024, two Court of Appeal decisions created uncertainty about the leave to appeal test. In West Whitby Landowners Group Inc. v. Elexicon Energy Inc.⁴, a three-judge panel reframed the leave inquiry around the broader question of whether the issue is of such importance that it ought to be determined by the Court⁵. This appeared to signal a greater willingness to hear appeals from the Divisional Court, which we discussed in a prior bulletin.

This apparent shift was called into question only two weeks later. In Davis v. Aviva General Insurance Company⁶, a different three-judge panel held that West Whitby had not changed the Sault Dock framework, but was simply a discussion of its application⁷.

The updated framework: two components

Knauff resolved the confusion. A five-judge panel considered whether the Sault Dock guidance remains adequate. The Court reaffirmed the core of Sault Dock but distilled it into two components: arguability and public importance. These two elements may—and likely will—overlap.

Arguability

Arguability asks whether there is a genuine issue for appeal. It does not require certainty that the appeal will succeed, but there must be a real issue that can then be assessed for its public importance. The Court identified examples of circumstances that may give rise to an arguable appeal⁸:

• Where the Divisional Court applied the wrong legal test or standard of review, potentially affecting the outcome.
• Where the existing law may need to be changed. Indicators include a constitutional issue, developments in the law, a novel issue or one lacking authoritative appellate guidance, the adequacy of the Divisional Court’s reasoning, a dissent in the Divisional Court, conflicting jurisprudence from other jurisdictions, or compelling legal commentary.

Public importance

Public importance requires an assessment from two perspectives. First, the Court considers those who may be affected by the resolution of the issue. This involves considering the breadth of categories of persons affected and how fundamental the affected interest is. Second, the Court considers the issue from a broader legal perspective, including the extent to which resolving it would advance the development of Ontario jurisprudence⁹.

The updated framework applies to all applications for leave

In addition to clarifying arguability and public importance, the Court in Knauff resolved uncertainty as to whether the test for leave varies depending on whether the Divisional Court exercises original or appellate jurisdiction.

The Court held that how a case arrives at the Divisional Court does not warrant a separate framework because it does not reflect whether further appellate recourse is justified. Thus, whether the Divisional Court was exercising original or appellate jurisdiction matters only to the extent that it is relevant to arguability and public importance¹⁰.

Implications

The core of the leave test in Sault Dock has not changed: arguability and public importance have always been its key pillars. But Knauff clarifies that the four categories of cases in Sault Dock, which were intended to serve only as examples, are not a rigid list¹¹, and there is no “special circumstances” category of cases warranting leave¹². In all cases, arguability and public importance will guide the Court of Appeal’s decision whether to grant leave.