Qubti v. Ontario Jockey Club [Indexed as: Qubti v. Ontario Jockey Club]

62 O.R. (3d) 290

[2002] O.J. No. 4753

Divisional Court File No. 285/01

Ontario Superior Court of Justice

Divisional Court

R.A. Blair R.S.J., Kurisko and Lalonde JJ.

November 29, 2002

Civil procedure -- Simplified procedure -- Plaintiff who abandons amount of claim in excess of $25,000 for purposes of bringing action under simplified procedure does not abandon that amount for all purposes but merely abandons amount for which judgment is actually awarded in excess of $25,000 -- Trial judge assessed damages in excess of $25,000 -- Trial judge did not err in applying reduction for contributory negligence to entire amount assessed rather than to $25,000 cap -- Rules of Civil Procedure, R.R.O. 1990, Reg. 194, Rule 75.

The plaintiff brought an action under the simplified procedure provided in Rule 76 of the Rules of Civil Procedure for damages for personal injuries. His claim was limited to $25,000, the monetary cap contained in rule 76.02(1)(a). The trial judge assessed his damages in the amount of $34,933.14 and found that he was 50 per cent responsible for his damages by reason of contributory negligence. She applied the contributory negligence to the amount of the assessed damages, not to the $25,000 claimed in the statement of claim. The defendant appealed.

Held, the appeal should be dismissed.

By making a claim under the simplified procedure, a plaintiff does not abandon the amount of his claim in excess of the $25,000 cap for all purposes. The abandonment relates to the amount of the claim for which judgment is awarded in excess of $25,000. The trial judge did not err in applying the reduction for contributory negligence to the amount of the assessed damages, since the amount of the judgment was under $25,000.

APPEAL from an award of damages.

Lillie v. Bisson (1999), 1999 2860 (ON SCDC), 46 O.R. (3d) 94, 41 C.P.C. (4th) 310 (C.A.), affg (1998), 1998 18853 (ON CA), 42 O.R. (3d) 524, 32 C.P.C. (4th) 52 (Div. Ct.), apld Bonneville v. IITC Holdings Ltd., [1999] O.J. No. 428 (Quicklaw) (Gen. Div.); Kingsberry v. Minto Developments Inc., [1999] O.J. No. 526 (Quicklaw) (Gen. Div.), not folld [page291] Statutes referred to Insurance Act, R.S.O. 1990, c. I.8, s. 267.1(8) Rules and regulations referred to Rules of Civil Procedure, R.R.O. 1990, Reg. 194, rules 49.10(2), 76, 76.02(1)(a), 76.05, 76.10(1)(a), (2)(a), (b), (5)

Charles Wagman and Shale Wagman, for plaintiff (respondent). Robert Calder, for defendant (appellant).

The judgment of the court was delivered by

[1] KURISKO J.: -- This is a "slip and fall" action that was commenced under the simplified procedure provided in Rule 76 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194. The respondent claimed damages in the amount of $25,000 plus prejudgment interest and costs.

[2] The trial took place on April 2, 3, and 4, 2001. Madame Justice Backhouse assessed the respondent's damages in the amount of $34,933.14. She found the appellant was negligent in failing to maintain its property in a safe condition. She also found the respondent 50 per cent responsible for his damages by reason of ignoring barriers that had been erected.

[3] Madame Justice Backhouse applied the contributory negligence of the respondent to the amount of the assessed damages and awarded judgment for $17,466.57. The appellant says the trial judge should have applied the contributory negligence to the $25,000 damages claimed in the statement of claim being the monetary cap of $25,000 contained in rule 76.02(1)(a) for simplified procedure actions. This appeal is restricted to that single issue.

[4] For the reasons that follow, the appeal is dismissed.

Submissions of Counsel for the Appellant

[5] In support of its position, the appellant relies on Kingsberry v. Minto Developments Inc., [1999] O.J. No. 526 (Quicklaw) (Gen. Div.) in which the plaintiff claimed damages from the defendant in the amount of $35,000 for wrongful dismissal plus interest and costs. The plaintiff abandoned his claim in excess of $25,000 in order to proceed under the simplified procedure in Rule 76. The court found that the total annual compensation of the plaintiff was $28,247 and that he was entitled to 12 months' notice. Having abandoned his claim in excess of $25,000, Panet J. [page292] stated the plaintiff was therefore entitled to damages in the amount of $25,000.

[6] Following his dismissal, the plaintiff had received $8,000 disability payments under an insurance policy funded by the employer. Panet J. held that the simultaneous payment of disability payments and the payment of damages for wrongful dismissal would be inconsistent with the terms of the employment contract and therefore "should be deducted from the damages recovered by the plaintiff for his wrongful dismissal". In rejecting the submission of the plaintiff that such deduction should be from the damages of $28,247 and not from the claim of $25,000, Panet J. said at para. 26:

The intent of the rule appears to be that any claim by the plaintiff in excess of $25,000 must be abandoned. To determine the claim of the plaintiff and the amount of that claim regard should be had to the statement of claim in the proceeding. . . . If the defendant's argument were to be accepted, the result would be that the plaintiff's claim over $25,000 would, with respect to Rule 76, be abandoned only for some purposes and not for others. . . . I conclude that the proper approach is to determine the claim of the plaintiff and the amount of that claim by reference to the statement of claim. For the purposes of Rule 76, an abandonment of that claim in excess of $25,000 applies for all purposes.

[7] The appellant also referred to Bonneville v. IITC Holdings Ltd., [1999] O.J. No. 428 (Quikclaw) (Gen. Div.) in which the court held that pursuant to the simplified procedure under Rule 76, a deduction to which the defendant was entitled must be against the amount claimed in the statement of claim, not against the amount of assessed damages.

Submissions of Counsel for the Respondent

[8] Counsel for the respondent says that Lillie v. Bisson (1998), 1998 18853 (ON CA), 42 O.R. (3d) 524, 32 C.P.C. (4th) 52 (Div. Ct.) supports the action taken by the trial judge herein. In that case, the statement of claim issued under the simplified procedure rules claimed damages of $40,000 for personal injuries. When the defendants objected to the action proceeding under the simplified rules, the plaintiff delivered a reply abandoning that portion of the claim in excess of $25,000 "exclusive of the statutory deduction as provided in section 267.1(8)3i of the Insurance Act, R.S.O. 1990 c. I.8". The amount of the deduction was $10,000.

[9] The defendants took the position that the reply did not comply with the rules of simplified procedure because the plaintiff had not abandoned his claim in excess of $25,000. They submitted that $25,000 in non-pecuniary damages could be recovered only by claiming $35,000 with the result that the simplified rules [page293] could not be used in the face of their objection. They claimed to be entitled to examine for discovery under the ordinary rules and when the plaintiff refused to attend for examination they moved to dismiss the action for failure to attend. The motion was dismissed. The defendants' appeal from that order was allowed. The plaintiff's appeal to the Divisional Court was allowed (2/1). [See Note 1 at end of document]

[10] The majority (Southey and Rosenberg JJ.) held that the words "exclusive of the statutory deduction" in the reply did not affect the amount of the plaintiff's claim. That amount remained at $25,000 because of the rules prescribed in s. 267.1(8) of the Insurance Act, R.S.O. 1990, c. I.8 for determining the amount of damages for non-pecuniary loss to be awarded. Under those rules, the court is directed first to determine the amount of the damages for which the owner of the automobile would be liable without regard to the statute. After that amount has been determined, the amount arrived at is reduced by $10,000. If the result is an award of more than $25,000, the judgment for the plaintiff would be $25,000 because he abandoned the portion of the claim in excess of $25,000. The majority said the resulting judgment for the plaintiff would have been the same if his reply had simply abandoned the amount claimed in excess of $25,000. The words "exclusive of statutory deduction" simply clarified the claim. They did not disentitle the plaintiff from continuing to proceed with the claim under the simplified rules procedure.

[11] In dissent, Cusinato J. rejected the argument that the plaintiff was entitled to use the simplified procedure provided the plaintiff did not seek to recover a judgment of more than $25,000. He held that by excluding the statutory deduction of $10,000 while seeking judgment for $25,000, the plaintiff was effectively making a claim for the amount excluded. Therefore, the plaintiff's claim did not comply with the rules for an action under the simplified procedure and should proceed as an ordinary action.

Discussion

[12] Where a claim is exclusively for an amount of $25,000 or less (exclusive of interest and costs), the simplified procedure is mandatory: rule 76.02(1)(a). A plaintiff who fails to use the simplified procedure and obtains a judgment of $25,000 or less (exclusive of interest and costs) is exposed to the significant [page294] costs consequences set out in clauses 76.10(1)(a), 76.10(2)(a) and 76.10(2)(b). [See Note 2 at end of document]

[13] The amount of the claim specified in the statement of claim and the amount of the judgment awarded at trial each serve a different purpose. The amount of the claim determines whether the simplified procedure applies with the consequential savings in costs to all parties. [See Note 3 at end of document] By limiting the claim to a maximum amount of $25,000 (exclusive of interest and costs) a plaintiff is protected against the significant costs consequences that would be incurred if a greater claim is made in an ordinary action and judgment is awarded for $25,000 or less. Limiting the claim to a maximum of $25,000 also defines the maximum exposure of the defendant.

[14] The end result is beneficial to both parties and in keeping with the following statement of the Court of Appeal in Lillie v. Bisson (1999), 1999 2860 (ON SCDC), 46 O.R. (3d) 94, 41 C.P.C. (4th) 310 (C.A.) at para. 4:

The simplified procedures contained in rule 76.01 of the rules of Civil Procedure are intended to provide a readily understandable and cost-effective method of resolving disputes where the monetary claim is $25,000 or less. The court should encourage a liberal interpretation of Rule 76 to carry out the policy behind the rule which is to reduce the cost of litigating claims of modest sums by reducing the amount of procedure available in such cases.

[15] The Court of Appeal rejected the dissenting reasons in Lillie stating that the matter "was fully and correctly dealt with by Southey J. speaking for the majority of the Divisional Court": (2000), 1999 2860 (ON SCDC), 46 O.R. (3d) 94 at para. 6.

Conclusion

[16] The reasoning of Southey J. in Lillie refutes the argument that by making a claim under the simplified procedure a [plaintiff] has abandoned the amount of his claim in excess of the [page295] $25,000 for all purposes as was decided in Kingsberry and Bonneville. In keeping with the liberal interpretation of Rule 76 dictated by the Court of Appeal, I conclude that such abandonment relates to the amount of the claim for which judgment is awarded in excess of $25,000. Thus, if the damages of the respondent had been assessed at more than $50,000 the judgment would have been limited to $25,000 (exclusive of interest and costs) regardless of the amount of the excess.

[17] The trial judge proceeded correctly in reducing the damages by 50 per cent for contributory negligence.

[18] Counsel have agreed that the costs of the successful party on this appeal should be fixed at $2,500 plus GST and it is so ordered.

Appeal dismissed.

Notes

Note 1: (1998), 1998 18853 (ON CA), 42 O.R. (3d) 524, 32 C.P.C. (4th) 52 (Div. Ct.).

Note 2: Such a plaintiff shall not recover any costs unless the action was under the simplified procedure at the commencement of the trial or unless the court is satisfied that it was reasonable for the plaintiff to have commenced and continued the action under the ordinary procedure: clauses 76.10(1)(a), 76.10(2)(a) and 76.10(2)(b). Moreover, where the action should have been under the simplified procedure at the commencement of the trial but was not, the trial judge has a discretion to order the plaintiff to pay all or part of the defendant's costs, including solicitor and client costs, in addition to any costs the plaintiff may be required to pay under subrule 49.10(2) (defendant's offer): subrule 76.10(5).

Note 3: The major cost effective feature of the simplified procedure is unavailability of examinations for discovery or cross-examination on affidavits filed on motions: rule 76.05.