CITATION: GENN CONSTRUCTION v. HOFFER et al, 2011 ONSC 1964
DIVISIONAL COURT FILE NO.: DC-11-008
DATE: 2011-03-28
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
Regional Senior Justice H. M. Pierce
BETWEEN:
3925308 MANITOBA INC., carrying on business under the firm name and style of GENN CONSTRUCTION (Plaintiff) RESPONDENT
– and –
HELEN HOFFER and MICHAEL HOFFER (Defendants) APPELLANTS
MS. CHERYL SIRAN, for the (Plaintiff) RESPONDENT
MR. H. SCHER, for the (Defendants) APPELLANTS
HEARD: March 24, 2011
Reasons on Motion to Extend the Time to File a Notice of Appeal
Introduction
[1] The appellants (defendants) move for an order extending the time to file a notice of appeal of judgment and costs granted in a construction lien case. They say the failure to file the notice of appeal was the result of a slip by counsel which has not prejudiced the respondent (plaintiff). The respondent strenuously resists the motion, arguing that the test to extend the time has not been met and it has been prejudiced.
The Test
[2] Counsel agree that the onus is on the moving party to satisfy the court on the following points in order to grant an extension of time to appeal:
- whether the appellants formed an intention to appeal within the relevant period;
- the length of the delay and the explanation for the delay;
- whether there is any prejudice to the responding party; and
- the merits of the appeal.
See: Petrykowski v. 553562 Ontario Ltd. (c.o.b. as Bell Cartage) [2011] O.J. No. 734 (Ont. C.J., Div. Ct.).
The Evidence
[3] A construction lien case was tried at Kenora, Ontario and reasons for judgment were released on October 15, 2010. Written submissions on costs were filed and reasons on costs were released on November 24, 2010.
[4] The appellants disagreed on the form of order drawn by the respondent’s counsel and had discussions about it. When they could not agree, respondent’s counsel submitted her draft to the court for signature, rather than moving to settle the order. The trial judge signed the order on January 27, 2011. Upon receipt of the judgment, the appellants drew a notice of appeal, served it upon respondent’s counsel and filed it with the court on February 7, 2011. This was 11 days after the final order was executed by the trial judge.
[5] The appellants’ counsel, George Orle Q.C., who practices law in Manitoba, filed an affidavit. He deposed that he received instructions to appeal several days after the reasons for judgment were delivered. He added that he directed co-counsel, who also practices law in Manitoba, to determine when the notice of appeal must be filed. He explained,
I was advised by Mr. Richert and did, from my own examination, believe that we had 30 days from the making of the “order” to appeal. Neither Mr. Richert nor I was aware that the definition of “order” included a “judgment” and that the 30 days began to run from the delivery of the reasons for judgment. We further believed that until all matters including the costs had been determined no order could be signed and filed in the lower court. It was our understanding that our clients had thirty (30) days to appeal from the date the Order was signed by the Honourable Madam Justice B.R. Warkentin and filed. This is the practice in Manitoba. The practice in Manitoba is that the time to appeal runs from the date an order is filed. The delay in filing the Notice of Appeal is entirely the fault of legal counsel and contrary to the decision of the Defendants to appeal. It was not the intention of the Defendants nor of legal counsel to deliberately delay this matter.
[6] In fact, s. 71 of the Construction Lien Act, R.S.O. 1990, ch. C.30 requires that a notice of appeal must be filed and served within fifteen days from the date of the judgment or order. The same section gives a single judge of the Divisional Court jurisdiction to extend the time for filing.
[7] The respondent’s solicitor filed an affidavit deposing that the appellants did not demonstrate any intention to appeal until they served a notice of appeal on February 4, 2011, some 112 days after reasons for judgment were released and 72 days after costs had been determined. The affidavit states that on November 4, 2010, the appellants discussed payment of the judgment and discharge of the lien.
[8] On the strength of this e-mail, and the fact that the time for appeal had passed, the respondent’s counsel advised her client that no appeal would be taken. The respondent arranged to settle debts outstanding to third parties from the construction project and its solicitors filed a writ of seizure and sale on January 31, 2011. The time of filing the writ is not indicated. The respondent argues that an appeal now will “stall the orderly settlement of this matter and cause further costs to our client.”
[9] The appellants counter that the respondent’s solicitor was advised by e-mail at 10:30 a.m. on January 31, 2011 of their intention to appeal. The respondent’s solicitor responded at 10:50 a.m. It is apparent she was aware of this intention to appeal immediately.
Discussion
[10] The court has discretion in deciding whether to extend the time for appeal. The court may consider whether the “justice of the case” requires that an extension be granted. See: Petrykowski. The onus is on the moving party to demonstrate that the appellant had the intention to appeal from the beginning and acted upon it. There must also be some reasonable explanation for the delay.
[11] In this case, I find that the appellants’ e-mail of November 4, 2010 does not necessarily negative the appellants’ intention to appeal. The communication was approximately 20 days after the release of the judgment and preceded the judgment being entered with the court. The parties were still negotiating the contents of the formal judgment at this time. If, as counsel for the appellants submits, they believed they had 30 days from the entry of the judgment to appeal, they were negotiating well within that time.
[12] It is not unusual that a party’s decision about taking an appeal might rest on whether conditions for enforcement of the judgment might be favourably negotiated.
[13] The first communication of intention to appeal was well within the window of the time the appellants’ solicitors believed they had to launch an appeal. In fact, the notice of appeal was served 11 days after the time they erroneously believed the clock had started to run. The e-mail stating the appellants intended to appeal was sent 8 days after the formal release of the judgment. In relation to the time frame the appellants’ solicitors believed they were bound by, they were within time to communicate their intention to appeal.
[14] The respondent argues that inaction of the appellants’ solicitor does not constitute a reasonable explanation for delay. See: Cozzi v. Cordeiro [2009] O.J. No. 3914 (Ont. S.C.J.). I do not agree that the evidence discloses inaction on the file on the part of the appellants’ solicitor. In fact, the evidence is that counsel engaged in on-going discussions about the case after judgment was rendered, but could not agree on the form of the judgment. While the appellants’ solicitors were mistaken as to the effect of the Construction Lien Act and the Rules of Civil Procedure in Ontario governing time to appeal under Ontario law, I accept the explanation tendered as being genuine.
[15] The respondent’s solicitor filed an affidavit. He deposes that his client has negotiated settlements with tradesmen and the Canada Revenue Agency for payments of accounts that have been outstanding since 2006. Now he cannot pay them. While this is unfortunate, he would have been in the same position had the notice of appeal been delivered in late October, 2010 instead of February 7, 2011.
[16] The respondent adds that his account with one lumber yard has been frozen which restricts his ability to earn a living. There is no indication as to how long this has been the case. He also is being charged monthly interest on outstanding accounts that he cannot pay. While this is also unfortunate, it is an issue that can be addressed by interest on the judgment.
[17] In practical terms, the respondent would not have been able to enforce the judgment until the judgment was formally entered with the court on January 27, 2011. Thus the delay in filing the notice of appeal was not excessive, given the delay in finalizing the judgment. Had the notice of appeal been served within the prescribed time limits in the Construction Lien Act, the respondent would have been put to the expense of responding to the appeal and suffered the delay of dealing with third parties. The appellants would have been able to advance their appeal as of right.
[18] There is no suggestion that the respondent has been prejudiced in the defence of the appeal. At its highest, the plaintiff has been put to the expense of filing a writ of seizure and sale. The lien remains in place. There is equity in the property sufficient to cover the judgment and any costs of the appeal that are ordered. The modest delay in advancing the appeal will not handicap the respondent in defending the appeal.
[19] The prejudice suffered by the respondent is largely financial and would have been suffered in any event had an appeal proceeded as of right. The prejudice can be mitigated by an award of interest and costs.
[20] Does the proposed appeal have merit? The appellants argue 18 grounds of appeal related to the trial and costs order. Two of the grounds are legal issues which the respondent says were not pleaded or addressed at trial; the remainder are based on the trial judge’s fact - finding, attracting a standard of review of palpable and over-riding error. While I have some doubt that there is merit in the legal issues advanced, it is impossible to know whether the factual issues challenged on appeal are meritorious without hearing the appeal itself.
[21] Society has an interest in having cases finally resolved with certainty. However, the courts recognize that a slip of counsel may jeopardize the rights of the client, as has happened here. The appellants’ solicitor deposes he received instructions to appeal a few days after the release of the judgment. There is no persuasive evidence to the contrary. The failure to serve and file a notice of appeal was attributable to the ignorance of counsel that a shortened appeal period is prescribed in the Construction Lien Act. As well, counsel misapprehended the time from which the appeal period started to run under Ontario law, which differs from the practice in Manitoba. The prejudice to the appellants in not permitting their appeal to go forward against these facts must also be considered.
Conclusion
[22] I conclude that the appellants have met the test for seeking an extension for time to appeal. Leave to extend the time for filing and serving the notice of appeal is granted. The notice of appeal must be served and filed within 7 days from the release of these reasons. The appeal is to the Divisional Court at Thunder Bay pursuant to s. 71 of the Construction Lien Act.
[23] If the parties cannot agree on costs of this motion, an appointment may be obtained from the trial coordinator at Thunder Bay to argue same by teleconference.
Regional Senior Justice H.M. Pierce
Released: March 28, 2011
CITATION: GENN CONSTRUCTION v. HOFFER et al, 2011 ONSC 1964
DIVISIONAL COURT FILE NO.: DC-11-008
DATE: 2011-03-28
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
Regional Senior Justice H. M. Pierce
BETWEEN:
3925308 MANITOBA INC., carrying on business under the firm name and style of GENN CONSTRUCTION (Plaintiff) RESPONDENT
– and –
HELEN HOFFER and MICHAEL HOFFER (Defendants) APPELLANTS
REASONS FOR JUDGMENT
Released: March 28, 2011