Kovach et al., Minors by their Litigation Guardian Kovach v. Kovach et al.

[Indexed as: Kovach (Litigation Guardian of) v. Kovach]

95 O.R. (3d) 34

Ontario Superior Court of Justice, Divisional Court, Carnwath, Swinton and Bellamy JJ. January 15, 2009

Civil procedure -- Trial -- Bifurcation -- Court not having jurisdiction to bifurcate trial where valid jury notice has been delivered and one of parties objects to bifurcation -- Court having jurisdiction to bifurcate jury trial in appropriate circumstances with consent of all parties -- Test for bifurcation more stringent than demonstration of clear benefit of time and expense -- Onus on party seeking bifurcation to demonstrate that case is exceptional.

The defendants in a personal injury action brought a motion for an order bifurcating the trial so that the issue of liability would be determined before the damages issue. The motion judge dismissed the motion, holding that the court lacks the jurisdiction to bifurcate a trial where, as here, a party has delivered a valid jury notice. That order was set aside on appeal on the basis that the court does possess such jurisdiction and that a bifurcation order was appropriate in the circumstances. The plaintiffs appealed.

Held, the appeal should be allowed.

An action with an extant jury notice cannot be bifurcated if one of the parties to the action objects. Where all the parties consent, a jury trial may be bifurcated in appropriate circumstances. The appeal judge misstated the test for bifurcation when she found that the onus on a party seeking bifurcation is to demonstrate "a clear benefit in terms of time and expense". Rather, the power to bifurcate is to [page35 ]be exercised only in the clearest of cases. The onus is on the party seeking bifurcation to demonstrate an exceptional case. There was no jurisdiction in this case to order bifurcation as all of the parties did not consent. Even if jurisdiction existed, this case was not exceptional and did not meet the very high burden that the law requires for a bifurcation order.

APPEAL from an order bifurcating a jury trial. [page36 ]

Cases referred to

Aghsani v. Briglio, 2006 17322 (ON SC), [2006] O.J. No. 2071, 148 A.C.W.S. (3d) 565 (S.C.J.); Ahmed v. Azzizzida, [2006] O.J. No. 4995, 40 C.P.C. (6th) 289, 41 M.V.R. (5th) 87, 153 A.C.W.S. (3d) 1088 (S.C.J.); Bourne v. Saunby, [1993] O.J. No. 2606, 23 C.P.C. (3d) 333, 49 M.V.R. (2d) 65, 43 A.C.W.S. (3d) 724 (Gen. Div.); Carreiro (Litigation Guardian of) v. Flynn, 2005 5850 (ON SCDC), [2005] O.J. No. 877, 195 O.A.C. 315, 137 A.C.W.S. (3d) 932 (Div. Ct.); Duffy v. Gillespie (1997), 1997 16236 (ON SC), 36 O.R. (3d) 443, [1997] O.J. No. 5008, 155 D.L.R. (4th) 461, 105 O.A.C. 283, 17 C.P.C. (4th) 91, 76 A.C.W.S. (3d) 46 (Div. Ct.); Elcano Acceptance Ltd. v. Richmond, Richmond, Stambler & Mills (1986), 1986 2591 (ON CA), 55 O.R. (2d) 56, [1986] O.J. No. 578, 16 O.A.C. 69, 9 C.P.C. (2d) 260, 38 A.C.W.S. (2d) 163 (C.A.); General Refractories Co. of Canada v. Venturedyne Ltd., [2001] O.J. No. 746, 6 C.P.C. (5th) 329, 103 A.C.W.S. (3d) 947 (S.C.J.); Royal Bank of Canada v. Kilmer van Nostrand Co., [1994] O.J. No. 1476, 29 C.P.C. (3d) 191, 48 A.C.W.S. (3d) 1339 (Gen. Div.); Schott v. Thomas, [2007] O.J. No. 1541, 46 C.P.C. (6th) 120, 156 A.C.W.S. (3d) 1041 (S.C.J.), consd

Other cases referred to

Air Canada v. WestJet Airlines Ltd., [2005] O.J. No. 5512, 20 C.P.C. (6th) 141, 144 A.C.W.S. (3d) 844 (S.C.J.); John Doe v. Ontario (Information and Privacy Commissioner) (1993), 1993 3388 (ON SCDC), 13 O.R. (3d) 767, [1993] O.J. No. 1527, 106 D.L.R. (4th) 140, 64 O.A.C. 248, 19 Admin. L.R. (2d) 251, 41 A.C.W.S. (3d) 1089 (Div. Ct.); McGraw v. Stoddart, [1995] O.J. No. 1065, 54 A.C.W.S. (3d) 859 (Gen. Div.); McKinlay Transport Ltd. v. Motor Transport Industrial Relations Bureau of Ontario (Inc.), [1995] O.J. No. 123, 37 C.P.C. (3d) 147, 52 A.C.W.S. (3d) 1224 (Gen. Div.); Mohajer Estate v. Frappier Group Inc., [1998] O.J. No. 5448, 86 O.T.C. 277, 34 C.P.C. (4th) 112, 84 A.C.W.S. (3d) 1082 (Gen. Div.); Morniga v. State Farm Mutual Automobile Insurance Co., [2002] O.J. No. 2094, [2002] O.T.C. 369, 26 C.P.C. (5th) 143, 114 A.C.W.S. (3d) 425 (S.C.J.); Shepley v. Libby McNeil & Libby of Canada Ltd. (1979), 1979 1971 (ON SC), 23 O.R. (2d) 354, [1979] O.J. No. 4066, 9 C.P.C. 201, [1979] 1 A.C.W.S. 123 (Div. Ct.); Stoiantsis v. Spirou (2008), 91 O.R. (3d) 184, [2008] O.J. No. 2736, 2008 ONCA 553, 57 C.P.C. (6th) 30, 168 A.C.W.S. (3d) 235, affg [2003] O.J. No. 3111, [2003] O.T.C. 729, 124 A.C.W.S. (3d) 1066 (S.C.J.); TDL Group Ltd. v. 1060284 Ontario Ltd., [2001] O.J. No. 1035, [2001] O.T.C. 188, 103 A.C.W.S. (3d) 1122 (S.C.J.); Unwin v. Crothers (2005), 2005 23337 (ON SC), 76 O.R. (3d) 453, [2005] O.J. No. 2797, [2005] O.T.C. 571, 17 C.P.C. (6th) 128, 140 A.C.W.S. (3d) 421 (S.C.J.); Woodglen & Co. v. Owens, [1995] O.J. No. 1360 (Gen. Div.); Zeitoun v. Economical Insurance Group (2008), 2008 20996 (ON SCDC), 91 O.R. (3d) 131, [2008] O.J. No. 1771, 292 D.L.R. (4th) 313, 53 C.P.C. (6th) 308, 165 A.C.W.S. (3d) 770, 236 O.A.C. 76, 64 C.C.L.I. (4th) 52 (Div. Ct.)

Statutes referred to

Courts of Justice Act, R.S.O. 1990, c. C.43, s. 108(1) [as am.] Family Law Act, R.S.O. 1990, c. F.3 Highway Traffic Act, R.S.O. 1990, c. H.8 Judicature Act, R.S.O. 1970, c. 228, s. 62(1)

Rules and regulations referred to

Rules of Civil Procedure, R.R.O. 1990, Reg. 194, rule 77.02 [as am.]

Kirk Stevens, for appellants/plaintiffs. Alan Rachlin, for respondents/defendents, Linn.

The judgment of the court was delivered by

CARNWATH J.: --

The Appeal

1Pursuant to leave granted by Lax J. [[2008] O.J. No. 2950, 158 A.C.W.S. (3d) 758 (Div. Ct.)], the plaintiffs appeal the order of Chapnik J., which bifurcates the jury trial in this action for personal injuries arising from a motor vehicle collision so as to require liability to be determined first. The order of Chapnik J. [(2008), 2008 20331 (ON SC), 91 O.R. (3d) 553, [2008] O.J. No. 1725 (S.C.J.)] set aside the order of Master Egan, which dismissed the motion of the defendants, Mackenzie E. Linn and Barry H. Linn, to bifurcate the trial. Master Egan held that the court lacks jurisdiction to bifurcate where there is a valid jury notice; she did not determine whether bifurcation was appropriate, assuming the existence of jurisdiction. Chapnik J. held that the court does possess such jurisdiction and that an order to bifurcate is appropriate in this case. Lax J. granted leave to appeal this order on both issues.

[2] Three issues are raised on this appeal: (a)(i) Does the court have the jurisdiction to bifurcate a trial where there is a valid, existing jury notice and where one of the parties objects to the bifurcation? (a)(ii) Does the court have the jurisdiction to bifurcate a trial where there is a valid, existing jury notice and where all parties to the action consent? (b) If the court does have the jurisdiction to bifurcate a jury trial in either of the situations described in (a) above, what is the test and is it met on the facts of this case?

Background

A. The parties and the issues in the action

3This action arises out of a motor vehicle collision on October 31, 1999 on Tuftsville Road in the Municipality of Stirling-Rawdon in the County of Hastings. A pickup truck operated by the defendant, Mackenzie E. Linn, and owned by the defendant, Barry H. Linn, struck a van owned and operated by the defendant, Pauline M. Kovach. The minor plaintiffs, Andrew Kovach [page37 ]and Sarah Kovach, were seated in the back of the Kovach vehicle. Wayne Kovach, their father, is their litigation guardian and claims in his own right under the Family Law Act, R.S.O. 1990, c. F.3. The defendant, Pauline Kovach, is the mother of Andrew and Sarah.

4Andrew, who was eight years old at the time of the accident, suffered a serious brain injury and pelvic fractures in the crash. The Linn defendants concede his impairments are catastrophic.

5Matthew Lake and Tyler Lake (Pauline Kovach's nephews) were also passengers in the Kovach vehicle. They have not commenced an action to date, but have put the defendants on notice of their claims.

6The plaintiffs allege inattention on Ms. Kovach's part and excessive speed by Ms. Linn. Both the Linn defendants and Ms. Kovach have denied liability and cross-claimed against each other. The statements of defence and cross-claims allege that Andrew's brain injury pre-existed the accident or, alternatively, that it arose due to subsequent conditions. The Linn defendants also raise a seat-belt defence against Andrew and Sarah.

7Coincidentally, Aviva Canada Inc. insured both the Kovach and Linn vehicles under separate and unrelated policies. Each policy also happens to have third-party liability limits of $1 million. The damages claimed for Andrew exceed $11 million.

B. The collision

8Ms. Kovach was taking the four children in the car "trick-or-treating" on Halloween. The collision occurred at approximately 5:20 p.m. in dusky conditions as Ms. Kovach was reversing her van northwards from a private driveway (the "McIntosh driveway") into Tuftsville Road. Tuftsville Road, which runs east-west in a more or less straight fashion, had a gravel surface. Ms. Linn, then a high-school student who had only obtained her licence to drive unsupervised the previous January, was driving her father's white pickup truck from east to west. The road had no posted speed limit signs between the accident site and its intersection with Highway 62, four kilometres to the east. Ms. Linn did not recall a posted speed limit, but thought it was 80 km/h. Two other witnesses observed her vehicle and remarked on its speed.

9The front of the Linn pickup truck penetrated through the left (i.e., driver's side) rear passenger door of the Kovach vehicle. The investigating police officer did not record the presence of any brake marks to show that Ms. Linn tried to stop before impact. There were no obstructions to Ms. Linn's line of sight for at least 175 metres east of the crash site. [page38 ]

10Ms. Kovach plead guilty to a Highway Traffic Act, R.S.O. 1990, c. H.8 charge of failing to yield the right of way. However, she has not admitted civil liability for the collision.

C. The proceedings in the courts below

11The plaintiffs and the Linn defendants have both delivered jury notices. The Linn defendants moved to have the liability issue determined before the damages issue. The motion was opposed by the plaintiffs.

1. Endorsement of Master Egan

12Holding that she was bound by this court's 1997 decision in Duffy v. Gillespie (1997), 1997 16236 (ON SC), 36 O.R. (3d) 443, [1997] O.J. No. 5008 (Div. Ct.), and its 2005 decision in Carreiro (Litigation Guardian of) v. Flynn, 2005 5850 (ON SCDC), [2005] O.J. No. 877, 195 O.A.C. 315 (Div. Ct.), Master Egan held that the court lacks the jurisdiction to bifurcate the trial in a case where a party has delivered a valid jury notice.

2. Reasons of motion judge for ordering bifurcation

13On appeal, Chapnik J. analyzed two decisions cited by this court in Duffy for the proposition that the Superior Court lacks the jurisdiction to bifurcate a trial where there is an extant, valid jury notice: this court's decision in Shepley v. Libby McNeil & Libby of Canada Ltd. (1979), 1979 1971 (ON SC), 23 O.R. (2d) 354, [1979] O.J. No. 4066 (Div. Ct.), and the Court of Appeal's decision in Elcano Acceptance Ltd. v. Richmond, Richmond, Stambler & Mills (1986), 1986 2591 (ON CA), 55 O.R. (2d) 56, [1986] O.J. No. 578 (C.A.). Referring to dicta in several cases subsequent to Duffy, including the decision of Sutherland J. in Carreiro and Molloy J.'s reasons in this court in Carreiro, she held that, on a close reading, Shepley does not stand for the proposition that the court lacks jurisdiction to bifurcate where one of the parties has served a jury notice and that the reference to Shepley in Elcano for that proposition was obiter. Chapnik J. referred to dicta in several cases questioning whether Shepley and Elcano truly establish that there is no jurisdiction to bifurcate a jury trial. However, Chapnik J. did not refer to the statement of Sutherland J. in Carreiro acknowledging that he was bound by Duffy's holding that the court lacks jurisdiction to bifurcate a jury trial. Nor did she refer to this court's holding in Carreiro that Sutherland J. was correct to hold himself so bound. Chapnik J. [at para. 20] concluded that the court's power to bifurcate trials derives from its "inherent jurisdiction to control its own processes to ensure that justice between the parties is effected" and that a Master [page39 ]has the jurisdiction to order the bifurcation of a jury trial under rule 77.02 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194.

14Since the parties agreed that it would be more expeditious if Chapnik J. decided the issue of whether bifurcation is appropriate in this case, rather than referring the issue back to Master Egan, she proceeded to do so. Relying on General Refractories Co. of Canada v. Venturedyne Ltd., [2001] O.J. No. 746, 6 C.P.C. (5th) 329 (S.C.J.), at paras. 10-17, she enunciated the test as follows [at para. 23]: ". . . the party seeking bifurcation has the onus of demonstrating a clear benefit in terms of time and expense" and, if met, the onus shifts to the responding party to demonstrate that "real prejudice . . . outweighs [the] expediency". In applying this test, Chapnik J. noted that a two-week jury trial on liability could be scheduled within a relatively short period of time, but that a lengthy trial encompassing all issues could not be scheduled for at least a year or more. She then discerned a trend in the cases to place "greater emphasis on . . . the most just and expeditious determination of [a] dispute, rather than the right of a party to have all issues tried at one time". Although she stated that bifurcation is still rare, she held [at para. 30], referring to rule 77.02, that the court may order it in "exceptional circumstances" where it is appropriate to bring the proceeding "expeditiously to a just determination".

15In applying this "clear benefit" test to the circumstances, Chapnik J. found that the liability issue was not complex, as it turned on a finding as to whether Ms. Linn exercised reasonable care. She saw this issue as being "completely distinct" from damages, which she perceived as considerably more complex. Finally, she expressed the view [at para. 32] that a finding in the Linns' favour would render a damages trial unnecessary, "particularly given the offer of Aviva as Pauline Kovach's insurer (which at this stage has not been accepted) to pay its policy limit of $1 million . . . in exchange for a release of further claims against Pauline Kovach". Accordingly, Chapnik J. concluded that "bifurcation would likely result in considerable savings in litigation costs and court time and would minimize delays without causing any real prejudice to the plaintiffs".

3. Reasons of leave judge doubting correctness of the bifurcation order

16In granting leave to appeal, Lax J. observed that this court in Carreiro held that Sutherland J. was correct to hold himself bound by Duffy's holding that the court lacks the jurisdiction to bifurcate a trial where there is an extant, valid jury [page40 ]notice. Accordingly, she held that there was reason to doubt the correctness of Chapnik J.'s conclusion on the jurisdiction issue.

17In granting leave to appeal on the test to be applied on a motion to bifurcate, Lax J. noted [at para. 15] that, in Elcano, the Court of Appeal held that the power to do so (in a non-jury case) was "narrowly circumscribed", only to be exercised in the "clearest of cases", and to be exercised "slow[ly]" where one of the parties objects to its exercise". Further, she noted that the cases speak of a "heavy burden", or "high threshold", on the party seeking bifurcation. Lax J. contrasted this test to the test applied by Chapnik J., which requires the moving party only to demonstrate a "clear benefit in terms of time and expense" and observed that the application of factors used by courts in cases analogous to the present case has led them to refuse bifurcation. She concluded by noting that the cases thus far have held that the prospect of avoiding weeks of evidence on damages if the plaintiff fails to establish liability is not an appropriate factor, because this prospect exists in many cases.

The Appellants' Position

18On the issue of jurisdiction to bifurcate jury trials, the appellants made four submissions.

19First, on the basis of s. 62(1) of the Judicature Act, R.S.O. 1970, c. 228, which is now s. 108(1) of the Courts of Justice Act, R.S.O. 1990, c. C.43, the Divisional court in Shepley held that the court "does not have the jurisdiction to sever an issue of fact or mixed fact and law, which this is, for determination before trial where there is a valid jury notice subsisting". In Shepley, the motions judge held that he had the jurisdiction to order the trial of an issue as judge alone, before the trial of other issues by the jury. The plaintiff/appellant in Shepley contended that the order deprived him of his substantive right to a jury trial on that issue. The focus of the Divisional Court in Shepley was on the court's power to deprive the plaintiff of his right to a jury determination of that issue by ordering bifurcation, not on whether it could sever a jury trial into two parts -- it did not appear to have occurred to the parties or the court to entertain the possibility of two jury trials. The governing statutory provision clearly assumed, then, as it does now, that a jury trial will not be bifurcated -- it confers a substantive (albeit, not absolute) right on the parties to an action to put issues of fact and mixed fact and law to "a jury" (singular).

20Second, in Elcano, the Court of Appeal was dealing with a judge-alone case where a trial judge, on his own motion, severed one aspect of the liability issue and determined it first. Morden J.A. [page41 ]held that, while neither statute nor regulation conferred the power to split a trial, the court has inherent jurisdiction to do so. However, he then observed that Shepley held that the power may not be exercised where a jury notice has been served.

21Third, in Duffy this court allowed an appeal from an order, made pursuant to the motion of a plaintiff, bifurcating a trial where a valid jury notice had been delivered. On the basis of both Shepley and Elcano, Blair J. [at para. 7] held that the "power to split a trial may not be exercised where one of the parties has served a jury notice and it is still outstanding".

22Fourth, as already noted in Carreiro v. Flynn, Molloy J. held that the motions judge in that case, Sutherland J., correctly held that he was bound by Duffy. Molloy J. described [at para. 10] the law on this question as providing for "an absolute prohibition" of orders to bifurcate jury trials. In brief obiter, Molloy J. offered that [at para. 12] "It may be the case that there are some trials that might appropriately be split, even where the result would be to have two separate juries trying separate issues in the case" (emphasis added). However, she also said that the case before her was not one where it would be appropriate to consider developing new law.

23The appellants made four submissions on the appropriate test and its application should this court find bifurcation of a jury trial can be granted over the objections of a party to the action.

24First, the appellants note that the Court of Appeal in Elcano held [at para. 11] that, even where the trial is to be by judge alone, the power to bifurcate "should be exercised, in the interest of justice, only in the clearest of cases". Morden J.A. further stated that if the parties consent to bifurcation, the court should give that request "substantial weight", but that, if one of the parties objects, the court should be "slow" to sever the issues (Elcano, pp. 58-59 O.R.).

25Second, the appellants noted the decision of Moore J. in Ahmed v. Azzizzida, [2006] O.J. No. 4995, 40 C.P.C. (6th) 289 (S.C.J.), at paras. 21-22, where he dismissed a motion to bifurcate liability and damages brought by a defendant in a motor vehicle negligence case:

It cannot be fairly concluded, therefore, that a trial on liability issues will, to use the words of Tucker J. (above), solve the case on a final basis. The parties have every right to be enthusiastic and adamant in their positions but as long as they remain so and as long as the positions are diametrically opposed, as appears clearly to be the situation here, there can be no real likelihood of a clear advantage to all parties produced by an order to bifurcate. The claimed savings in overall trial time and expense may be illusory. Whether the responding defendants on this motion are absolved of [page42 ]any responsibility for the injuries and damages of the plaintiff pedestrians or not, there is no guarantee that that outcome will be accepted by all defendants, be they winners or losers on the issue, and a damages trial may well be required and appeals on either or both of liability and damages outcomes may well follow.

At this point, it is impossible to predict whether it will be advisable or possible to try damages issues with the same jury that determines liability issues in a bifurcated trial. Separate trials with but one jury may prove burdensome to that jury, depending upon how long the interval between trials may be. Trials involving two juries could lead to differing findings of fact by each jury and outcomes difficult for the parties, let alone an appeal court, to reconcile.

26Third, the appellants submit that if one of the parties appeals a verdict on liability following that portion of the trial, it would be impossible to reconvene the same jury. The appellants submit that whatever way the liability issue is decided by a jury, an appeal from that finding might well be taken by either party to the proceedings, depending on which way the finding went.

27Fourth, the appellants submit that Chapnik J. applied the wrong test when she spoke of a "clear benefit". Trial courts have interpreted the onus established in Elcano on a party seeking bifurcation as a "heavy burden" and a "high threshold" (see Air Canada v. WestJet Airlines Ltd., [2005] O.J. No. 5512, 20 C.P.C. (6th) 141 (S.C.J.), at para. 33, and General Refractories Co., supra, at para. 46). The "clear test" applied by Chapnik J. is much less stringent and, the appellants submit, is clearly wrong.

The Respondents' Position

28On the issue of jurisdiction to bifurcate jury trials, the respondents made five submissions.

29First, the respondents note that in Shepley, the motions judge's decision had the effect of striking out the jury notice with respect to a limitation issue, thus depriving the plaintiff of his right to have all issues of fact tried by a jury. The Shepley decision is therefore clearly distinguishable from the facts of this case in that the bifurcation order granted by Chapnik J. will not deprive the plaintiffs of the right to have all issues determined by a jury.

30Second, Elcano concerned allegations of negligence against a firm of solicitors. No jury notice was delivered. On appeal, the Ontario Court of Appeal noted (at para. 12) that although the court clearly had the power to bifurcate issues, they did not believe the trial judge had properly exercised that power. The respondents submit that the statement in Elcano by Morden J.A. [at para. 10] that "[i]t has been held that the power [to bifurcate] may not be exercised where one of the parties has served a jury notice: Shepley v. Libbey McNeil" is clearly obiter. [page43 ]Moreover, Morden J.A.'s reference to Shepley fails to make it clear that there was an unavoidable consequence of the bifurcation order -- one of the parties lost the right to a jury trial.

31Third, the appellants submit the Duffy decision is equally distinguishable from this case in that a bifurcation order in Duffy would have unfairly deprived a party of the right to a determination of all facts by a jury and also because the facts in that case did not come within the judicially recognized criteria in support of bifurcation.

32Fourth, the respondents submit that on the Carreiro appeal of Sutherland J.'s refusal to order a bifurcation, Molloy J., writing for a unanimous panel of the Divisional Court, declined to "revisit" the issue of the effect of a jury notice given the facts of the case that was before the panel. Molloy J. then went on to note [at para. 12] that "[i]t may be the case that there are some trials that might appropriately be split, even where the result would be to have two different juries trying separate issues in the case".

33Fifth, the respondents further submit that this court is not bound by the comments made by the court in Carreiro because bifurcation in the context of an extant jury notice was not the issue that was being decided in that case. This is an error. There was an extant jury notice in Carreiro and it was the issue being decided in that case.

34On the question of the appropriate test and its application, the respondents made four submissions.

35First, the respondents submit that bifurcation is warranted where the court is satisfied on a balance of probabilities that splitting the trial would more likely than not result in the just, expeditious and least-expensive determination of the proceeding on the merits. They cite Unwin v. Crothers (2005), 2005 23337 (ON SC), 76 O.R. (3d) 453, [2005] O.J. No. 2797 (S.C.J.), at para. 79. It should be noted that Unwin was a non-jury matter, of which more later.

36Second, the respondents cite Bourne v. Saunby, [1993] O.J. 2606, 23 C.P.C. (3d) 333 (Gen. Div.), at para. 30, and its 14 criteria set forth by Tobias J. in that case. The respondents submit that these criteria have been traditionally taken into account in determining whether bifurcation should be allowed. Once again, it should be noted that Bourne was a non- jury matter.

37Third, the respondents submit that a motion for bifurcation must also be considered with a paramount view to achieving the purposes of case management set out in rule 77.02. The rule contemplates that case management reduces unnecessary costs and delay in civil litigation, facilitates early and fair settlements and brings proceedings expeditiously to a just determination. In support of the rule 77.02 purposes, the respondents cite a host of [page44 ]cases in support of the proposition (see Unwin v. Crothers, above; Bourne v. Saunby, above; Stoiantsis v. Spirou, [2003] O.J. No. 3111, [2003] O.T.C. 729 (S.C.J.), affd (2008), 2008 ONCA 553, 91 O.R. (3d) 184, [2008] O.J. No. 2736 (C.A.); Woodglen & Co. v. Owens, [1995] O.J. No. 1360 (Gen. Div.); Royal Bank of Canada v. Kilmer van Nostrand Co., [1994] O.J. No. 1476, 29 C.P.C. (3d) 191 (Gen. Div.); McGraw v. Stoddart, [1995] O.J. No. 1065, 54 A.C.W.S. (3d) 859 (Gen. Div.); McKinlay Transport Ltd. v. Motor Transport Industrial Relations Bureau of Ontario (Inc.), [1995] O.J. No. 123, 37 C.P.C. (3d) 147 (Gen. Div.); TDL Group Ltd. v. 1060284 Ontario Ltd., [2001] O.J. No. 1035, [2001] O.T.C. 188 (S.C.J.); Morniga v. State Farm Mutual Automobile Insurance Co., [2002] O.J. No. 2094, [2002] O.T.C. 369 (S.C.J.); and Mohajer Estate v. Frappier Group Inc., [1998] O.J. No. 5448, 86 O.T.C. 277 (Gen. Div.)). It should be noted that all of the above cases were non-jury matters.

38Fourth, the respondents submit that Chapnik J. applied appropriate principles in exercising her discretion to bifurcate the liability issue from damages by taking into account the case management system; finding the liability issue to be tried not overly complex; finding "a fairly clear" demarcation between the liability issues and the damages issues; finding a substantial likelihood that a finding on the liability issue in favour of the respondents would render a damages trial unnecessary; finding that bifurcation would likely result in considerable savings in litigation costs and court time; and finding no evidence of actual prejudice to the appellants if bifurcation occurs.

Analysis

Standard of review

39In considering the standard of review of Master Egan's decision, that standard is found in Zeitoun v. Economical Insurance Group (2008), 2008 20996 (ON SCDC), 91 O.R. (3d) 131, [2008] O.J. No. 1771 (Div. Ct.). The standard of review on appeals from judges should be applied to appeals from Masters. Whether final or interlocutory, a decision should be interfered with only if the Master makes an error of law or exercises a discretion on wrong principles or misapprehends evidence such that there is a palpable and overriding error.

(a)(i) Does the court have the jurisdiction to bifurcate a trial where there is a valid, existing jury notice and where one of the parties objects to the bifurcation?

40Master Egan found that she lacked jurisdiction to bifurcate a jury trial. Chapnik J. (at para. 10) appears to have considered [page45 ]the order of the Master as discretionary. With respect, the Master found she lacked jurisdiction and she was either correct in law or not.

41With respect, we find Master Egan to be correct in law in concluding that she was bound by the decisions of the Divisional Court in Duffy and Carreiro. To recapitulate, Sutherland J. found, on the motion to bifurcate, that he was bound by Duffy and that he had no power to split a trial in which a jury notice was filed. On appeal from Sutherland J.'s order, the Divisional Court, at para. 11, held that Sutherland J. "quite correctly held he was bound to follow Duffy v. Gillespie".

42Master Egan was bound by Carreiro and Chapnik J. was bound by Carreiro. We see no reason to depart from the decision of another panel of the Divisional Court. This court has held that it "will ordinarily follow its previous judgments, unless they have been overruled by a higher authority" (see John Doe v. Ontario (Information and Privacy Commissioner) (1993), 1993 3388 (ON SCDC), 13 O.R. (3d) 767, [1993] O.J. No. 1527 (Div. Ct.), at p. 778 O.R.). While on rare occasions it may be possible to depart from stare decisis, no factors exist in this matter that would persuade us to do so.

43We say the law in Ontario at the present time is that an action with an extant jury notice cannot be bifurcated if one of the parties to the action objects.

44In the respondents' factum, three cases are cited for the proposition that a jury trial can be bifurcated over the objections of one of the parties (see Aghsani v. Briglio, 2006 17322 (ON SC), [2006] O.J. No. 2071, 148 A.C.W.S. (3d) 565 (S.C.J.); Ahmed, above; and Schott v. Thomas, [2007] O.J. No. 1541, 46 C.P.C. (6th) 120 (S.C.J.)). In each of these cases, the motions judge found that a jury trial could be bifurcated over the objections of one of the parties. In each of the cases, the motions judge refused to grant the bifurcation order. To the extent that these cases stand for the proposition that a jury trial can be bifurcated over the objection of a party to the action, we say, with respect, the statements in the cases are wrong in law.

(a)(ii) Does the court have the jurisdiction to bifurcate a trial where there is a valid, existing jury notice and where all parties to the action consent?

45We are not prepared to conclude that under no circumstances may a jury trial be bifurcated. If all parties to the action consent, the judge will then be required to determine whether it is appropriate.

46We suggest that the principles extracted from non-jury cases in support of such a consent proposal should be [page46 ]approached with great caution. Those principles have been enunciated in the knowledge that the same judge will likely hear the issue of liability and damages. What is lacking in those cases is any necessity to appreciate the mischief that may be caused by a matter where one jury hears the liability issue and another jury hears the damages issue. At the conclusion of the liability issue, there is always the possibility of an appeal by one side or the other. If an appeal is taken, the likelihood of retaining the same jury is remote. With a second jury, there is a danger of inconsistent findings. It is a rare case where there is a clean break between liability and damages. Perforce, findings of liability will ordinarily be inextricably bound with the issue of damages.

47We can imagine a situation where the parties to an action on consent propose that the jury hear the evidence on liability, render a verdict and then stand down for a day or two while the parties consider their positions. In that period, settlement discussions could take place and a resolution achieved. Absent resolution, the return of the jury after a day or two to hear the evidence on damages would not, in our view, cause a disruption in the trial process. Whether this would be a true bifurcation is another question.

48Similarly, a consent request could be made that the judge dispose of a preliminary matter and that the jury deal with damages or, indeed, vice versa. This has at least the salutary effect of maintaining judicial continuity.

(b) If the court does have the jurisdiction to bifurcate a jury trial in either of the situations described in (a) above, what is the test and is it met on the facts of this case?

49As noted above, it is our view that a jury trial can never be bifurcated unless all the parties to the action consent.

50We agree with the reasoning of Sutherland J. in Carreiro, which was specifically approved by this court. Sutherland J. said, at para. 22 [[2004] O.J. No. 3117, [2004] O.T.C. 664 (S.C.J.)]:

While generally speaking I believe that in these bifurcation matters more emphasis should be placed on the saving of judicial resources, I would not want the court to solve some of its scheduling, workload and backlog problems on the backs of seriously injured minor plaintiffs. In such cases the bar, which is always high, is in my view even higher.

51The bar referred to by Sutherland J. flows from the Court of Appeal decision in Elcano, where it held that the power to bifurcate is a "narrowly circumscribed power", to be exercised only in the "clearest cases" and that "a court should be slow to exercise the power if one of the parties . . . objects to its exercise" (para. 11). [page47 ]The onus is on the party seeking bifurcation to demonstrate an exceptional case.

52We respectfully disagree with Chapnik J. that the onus on a party seeking bifurcation is to demonstrate "a clear benefit in terms of time and expense". Once that onus is satisfied, Chapnik J. would shift the onus to the opposing party to demonstrate real prejudice that outweighs the expediency established. In support of this view, Chapnik J. cited Himel J. in General Refractories Co. of Canada v. Venturedyne Ltd., supra, at para. 13:

Whether these cases suggest a liberalization or simply an elaboration of the reasoning of Justice Morden in Elcano, supra, the basic principles continue to be clear. The defendants have, at the first instance, the onus of demonstrating that there is a clear benefit to be gained, in terms of time and expense, from severing an issue from the trial. This is particularly so given the plaintiff's strenuous objection to severance: Elcano, supra, at p. 263. Once the defendants have met that burden, it is for the plaintiff to demonstrate real prejudice which outweighs any such expediency: Royal Bank v. Kilmer, supra, at p. 198. (Royal Bank of Canada v. Kilmer van Nostrand Co., supra)

53Royal Bank v. Kilmer was a decision of Wilkins J. It was a non-jury matter in which Wilkins J. found that the moving party had shown ingenuity in complicating a straightforward guarantee case. He granted bifurcation of two issues -- negligence, and guarantee and indemnity. This case underlines the caution with which non-jury cases should be approached where bifurcation has been granted. No one could quarrel with the discussion of expediency and the preservation of limited public resources found in Bourne, General Refractories and Royal Bank v. Kilmer. However, these discussions related to non-jury actions and, in our view, it is wrong to mechanically apply the tests enunciated in those cases to cases where a jury notice is extant.

54With respect, we find the test applied by Chapnik J. to be wrong in law. We conclude this test is more stringent than "a clear benefit of time and expense". For this reason, had we found we had the jurisdiction to bifurcate a jury trial on the facts of this case, we would not have done so. This is not an exceptional case, nor does it meet the very high burden that the law requires for a bifurcation order.

55The appeal is allowed. The order of Chapnik J. is set aside and the order of Master Egan is restored.

56Costs to the appellants, including $5,000 awarded by Master Egan, $4,000 before Chapnik J., $2,500 before Lax J., and $3,000 before us, plus GST, partial indemnity, [are] payable within 30 days.