Classic POS Inc. v. Hinic, 2018 ONSC 5791

CLASSIC Pos Inc. v. Hinic, 2018 ONSC 5791

CITATION: CLASSIC Pos Inc. v. Hinic, 2018 ONSC 5791

COURT FILE NO.: 106/17

COURT FILE NO.: 141/17

DATE: 2018/10/01

ONTARIO

SUPERIOR COURT OF JUSTICE

DIVISIONAL COURT

BETWEEN:

CLASSIC POS INC. Appellant

– and –

GORAN HINIC AND BUSINESS #322526412 Respondent

AND BETWEEN:

CLASSIC POS INC. Appellant

• and –

BUSINESS #828126714 O/A HOLLY LODGE Respondent

Ineke Sutherland in person and for Classic Pos. Inc.

John No for the Respondents

HEARD: September 27, 2018

PERELL, J.

REASONS FOR DECISION

A. Introduction

1In a Small Claims Court action, Goran Hinic sued Classic POS Inc. (“Classic”). In another Small Claims Court action, Holly Loggie sued Classic. The actions were tried together. Classic was unsuccessful. Classic appealed. The Registrar dismissed the appeals, because of Classic’s failure to deliver proof that it had ordered the trial transcript. However, Justice Myers set aside the Registrar’s Orders on terms that: (a) Classic pay security for costs; and (b) Classic file new proof that it had ordered the transcript. Classic did not comply with Justice Myers’ Order; and the Registrar again dismissed the appeals for failure to file a new proof that it had ordered the transcript. Classic now applies for: (a) an Order setting aside the registrar’s Orders dismissing the appeals; and (b) for an extension of time for leave to appeal Justice Myers’ Orders of May 22, 2018 with respect to paragraphs 18a, 19, and 20 of his endorsement where he ordered security for costs and costs be paid.

2For the reasons that follow, Classic’s motions are dismissed.

B. Facts

3In 2013, in separate Small Claims Court actions, Mr. Hinic and Ms. Loggie sued Classic for wrongful dismissal. Classic asserted counterclaims. The actions were tried together over six days in October 2016.

4In Reasons for Decision released on January 4, 2017, Deputy Judge A. McNeely awarded $3,994.91 to Ms. Loggie. Classic’s counterclaim was dismissed. In Reasons for Decision released on January 9, 2017, Deputy Judge A. McNeely awarded $5,489.40 to Mr. Hinic. Classic’s counterclaim was dismissed.

5On February 6, 2017, Classic served a Notice of Appeal and the Appellant’s Certificate Respecting Evidence on Ms. Loggie. (The Notice of Appeal was late, but by Order on April 21, 2017, the Divisional Court permitted the late filing.) On February 8, 2017, Classic served a Notice of Appeal and the Appellant’s Certificate Respecting Evidence on Mr. Hinic.

6For both appeals, Classic ordered a transcript for the six-day trial. However, subsequently, Classic did not file with the Registrar proof that the transcript had been ordered, and Mr. Hinic and Ms. Loggie moved to have the appeal dismissed. However, just before the motion was scheduled to be heard, Classic filed the proof that it had ordered the transcript for a six-day trial, and the registrar dismissed the motion.

7On March 29, 2017, Justice Stewart ordered service of documents to Classic to be pre-arranged by Mr. Hinic or Ms. Loggie’s lawyer phoning Classic to make arrangements to accept service.

8Sometime in May or June 2017, the transcription service advised Ms. Ineke Sutherland, who is the principal of Classic, that the cost of the transcript would be around $5,000 and not the originally estimated $500. After Ms. Sutherland delivered a cheque and offered to pay $1,500 for the transcript, the transcription service cancelled the order.

9Although Ms. Sutherland should have been aware that the $1,500 cheque was never cashed, she apparently assumed that the transcript was being prepared, and she deposed that she was not made aware of the cancellation. She did not, in any event, follow up to confirm that the transcript was being prepared.

10In the fall of 2017, Mr. Hinic’s and Ms. Loggie’s lawyer learned about the cancellation of the transcript order, and they brought a motion to have the appeals dismissed. The motion was scheduled for December 12, 2017.

11Unfortunately, Justice Stewart’s Order about pre-arrangements for service had not operated smoothly and , there was a history of difficulties in serving documents on Classic and in scheduling motions, and Ms. Sutherland did not attend the hearing of Mr. Hinic’s and Ms. Loggie’s motion. Although aware of the hearing date for the motions before the Registrar, Ms. Sutherland did not attend the hearing because of a medical appointment.

12On December 12, 2017, the Registrar dismissed the appeals for delay.

13On January 10, 2018, Classic appealed the registrar’s decision dismissing the appeals. It also brought a motion for an Order fixing the price of the transcript and specifying that the appeal record need only contain the transcripts for the first and the last day of the trial.

14Mr. Hinic and Ms. Loggie opposed the resumption of the appeals, and they opposed the request that there be a truncated transcript of the trial transcript.

15On May 18, 2018, Justice Myers heard Classic’s motions, and in an endorsement released on May 22, 2018, Justice Myers set aside the registrar's Orders on terms that: (a) Classic pay $2,000 in security for costs for each of Mr. Hinic and Ms. Loggie; and (b) Classic file proof that it had ordered the transcript by June 1, 2018. Further, Justice Myers ordered Classic to pay costs of $750 by June 1, 2018.

16Justice Myers dismissed Classic’s requests that the court fix the price of the transcript and that the appeal record need only contain the transcripts for the first and the last day of the trial.

17Justice Myers was not impressed with Classic’s conduct in not perfecting the appeals, but he was “not prepared to quash the appeals at this time,” because he felt he could craft conditions craft conditions that “will allow the appeals to proceed more efficiently on the merits without dismissing them as yet.” He also felt that it was appropriate to require Classic to post security for costs. At paragraphs 18-20 of his endorsement, Justice Myers stated:

18Therefore, the motions are granted and the registrar's orders dated December 12, 2017 dismissing the appeals for delay are set aside on the following terms added under Rules 1.05, 37.13 (l) as incorporated into Rule 61.16 (1), and Rule 56.09 as follows:

a. The respondents are entitled to serve all documents required to be delivered by them in these appeals on the appellant by PDF attachment to an email sent to the email address of the appellant to which this endorsement is sent by the court. […]

b. If it wishes to do so, the appellant in each appeal may serve and file an amended Certificate Respecting Evidence on or before 4:00 p.m. EDT on May 25, 2018.

c. If the appellant in either or both appeals delivers an amended certificate, then the respondents may file an amended Certificate Respecting Evidence in response on or before 4:00 p.m. EDT on May 29, 2018.

d. Regardless of whether amended certificates are delivered by any party, the appellant shall serve Counsel to the respondents and file with the registrar by 4:00 p.m. EDT on June l, 2018 proof that it has ordered transcripts from a duly accredited court transcriptionist as required by Rule 61.13.

e. If the appellant fails to file new proof in each appeal that it has ordered transcripts from an accredited court transcriptionist by 4:00 p.m. EDT on June 1, 2018, the registrar shall immediately dismiss the appeal or appeals in which no such proof is filed.

19. The appellant has not retained counsel. It is appealing very modest judgments. It has filed evidence about its desire to be frugal with transcription costs to the extent of ordering from non-accredited sources. It has not diligently pursued the appeals and it has taken steps to increase the respondents' costs with its approach to service. Based on the totality of these facts, the respondents raise a concern for the recoverability of its costs and the judgments below. In my view, it is fair and reasonable, as a condition of the court exercising its discretion to refrain from dismissing the appeals, that the appellant be ordered to post security for the costs of the respondents of $2,000 in cash or certified finds with the accountant of this court in each appeal before 4:00 p.m. EDT on June 29, 2018. Rules 56.05 to 56.08, inclusive, apply to this ruling. The only exception to the stay imposed by Rule 56.05 is the filing of the proof of ordering transcripts required in subparagraph 18 (d) above.

20. While the appellant has been successful on the motion in setting aside the orders of the registrar, it is clear that all of this procedural quagmire lies at the appellant's feet. None of these process steps would have occurred had the appellant been diligent in handling its transcript order and cooperative in dealing with service. The appellant is receiving an indulgence. Therefore, this is an appropriate case in which to award the respondents their costs of the motion. The respondents seek $750 which is very reasonable. Classic POS Inc. shall pay the respondents jointly and severally through their counsel the aggregate sum of $750 costs on a partial indemnity basis by certified funds payable to their counsel's clinic and delivered to his office by 4:00 p.m. EDT on June 1, 2018.

18In making his Order, Justice Myers reasoned that the registrar had only an administrative authority under Rule 61.13 and that the registrar did not have the jurisdiction under that Rule to determine the quality of compliance with the rules. Justice Myers concluded that Classic had filed proof of ordering transcripts before the registrar's hearing, and in these circumstances, the registrar had no authority to dismiss the appeal for delay.

19Justice Myers also reasoned that it was not for the court to determine the content of the appeal record. This was a matter for the parties to settle in accordance with the Rules of Civil Procedure and their conduct in this regard would be a matter to be dealt with in the assessment of costs after the hearing of the appeals.

20On May 24, 2018, in accordance with the terms of Justice Myers’ order, Classic served Mr. Hinic and Ms. Loggie with an Amended Certificate Respecting Evidence. The certificate specified that the transcript only for the first and last day of the trial was to be included in the appeal record.

21On May 29, 2018, Mr. Hinic and Ms. Loggie served the Respondent's Certificate Respecting Evidence. They specified that a full transcript of the six-day trial was necessary for the appeals.

22On June l , 2018 Classic filed the Certificate/Proof of Ordering Transcript for Appeal that had been filed on May 12, 2017; i.e., the old certificate indicated that the transcript for six days of trial had been ordered. Classic did not file a new Certificate. Classic did not post security for costs. It did not pay the costs ordered by Justice Myers.

23By letter dated June 5, 2018, Classic requested that Mr. Hinic and Ms. Loggie consent to an extension of time to serve a Notice of Appeal from Justice Myers' order. The letter stated:

Dear Sirs:

We plan to appeal the order of Judge Myers and have been working on it with the understanding that appeals had to be served within 30 days.

It appears that we may have made an error and that a Notice of Appeal should have been served within 7 days.

We would appreciate your consent to extend the time to serve the Notice of Appeal and Appellants Certificate to Wednesday, June 13, 2016.

Should we not get your consent we will be obliged to apply to the court for the extension

24Mr. Hinic and Ms. Loggie refused to consent.

25On June 15, 2018, Mr. Hinic and Ms. Loggie advised Ms. Sutherland that they would be seeking costs against her personally for abuse of process, if she proceeded with the appeal of Justice Myers' order.

26On July 19, 2018, Mr. Hinic’s and Ms. Loggie’s lawyer asked the registrar to enforce Justice Myers Order. At the registrar’s request, Mr. Hinic’s and Ms. Loggie’s lawyer filed an affidavit and on July 20, 2018, the registrar dismissed the appeals. The registrar made the following Order in each appeal:

The Appellant, Classic Pos Inc. has not served or filed new proof that it has ordered transcripts of evidence that the parties have not agreed to omit from a duly accredited court transcriptionist by 4:00 p.m. on June 1, 2018 as prescribed by Mr. Justice Myers in his order dated May 22, 2018. Upon reading the affidavit evidence filed by counsel for the respondents, THIS COURT ORDERS that this appeal is hereby dismissed.

27On July 29, 2018, Classic brought a motion for: (a) an Order setting aside the registrar’s Orders dismissing the appeals; and (b) for an extension of time for leave to appeal Justice Myers’ Orders with respect to paragraphs 18a, 19, and 20 on his endorsement.

28On August 3, 2018, Mr. Hinic’ and Ms. Loggie’s lawyer sent the following email message to Ms. Sutherland:

I received your correspondence to schedule a motion date to seek leave to appeal Justice Myer’s order. As you are aware, Justice Myers set out three conditions that you had to meet in order for you to continue your appeals: (1) pay $4,000 as security for costs by June 29, 2018, (2) pay $750 in costs to Mr. Hinic and Ms. Loggie by June 1, 2018, and (3) file new proof in each appeal that you have ordered transcripts from an accredited court transcriptionist by June 1, 2018.

You failed to meet conditions (1) and (2). You then notified us that you wish to appeal Justice Myers’ decision with respect to conditions (1) and (2). I assume that you did not dispute condition (3). However, you also failed to meet condition (3) when you filed the same proof that you filed last year. This was the same proof related to the cancelled transcript order.

As you ignored Justice Myers’ order to file new proofs, the Registrar has dismissed your appeals. As such, it is now moot to seek leave to appeal Justice Myers’ decision with respect to conditions (1) and (2).

29Also, on August 3, 2018, Ms. Sutherland sent Mr. Hinic’s and Ms. Loggie’s lawyer the following letter:

Sirs:

We are in receipt of your email this morning.

It would appear that a mistake on our part was made with serving you with the wrong Confirmation of ordering a transcript.

We will proceed on September 27, 2018 to include our appeal of Justice Myers’ order the motion to set aside the registrar’s order on the basis that a mistake was made by us in servicing and filing the wrong copy of the Order for Transcript of an Ontario Court Proceeding as required. Or, in the alternative, you can agree to set aside the Registrar’s order on the basis that we made this mistake.

If you do not consent to set aside the registrar’s order and do not agree with this date please provide us with one you do agree with

30Classic subsequently filed a Certificate of Ordering a Transcript. The certificate indicates that a partial transcript has been ordered. It indicates that the evidence to be transcribed for the transcript is the first and the last day of the six-day trial.

C. Discussion

31I shall begin the discussion with a preliminary matter associated with Classic’s request for an extension of time for leave to appeal Justice Myers’ Orders of May 22, 2018.

32Apart from the substantive merits of this request, this request is misconceived because there is no appeal from Justice Myers’ order; rather, what Classic requires is an extension of time to bring a motion pursuant to rule 61.16 of the Rules of Civil Procedure and s. 21(5) of the Courts of Justice Act, R.S.O. 1990, c. 45 to set aside or vary an order of a single judge of the Divisional Court by a panel of the court.

33Under rule 61.16 (6), the motion to set aside or vary the single judge’s order is to be served within four days after the order is made. I, therefore, shall treat Classic’s request as a request for an extension of time to bring a motion under rule 61.16 (6).

34Turning next to Classic’s request that the registrar’s orders made in July 2018 be set aside, when Justice Myers’ set aside the registrar’s December 2017 orders dismissing the appeals, Justice Myers exercised his jurisdiction pursuant to Rules 1.04, 1.05, and 37.13 of the Rules of Civil Procedure.

35Rule 1.04 directs the court in how the rules should be interpreted and applied. Rule 1.04 states:

INTERPRETATION

General Principle

1.04 (1) These rules shall be liberally construed to secure the just, most expeditious and least expensive determination of every civil proceeding on its merits. R.R.O. 1990, Reg. 194, r. 1.04 (1).

Proportionality

(1.1) In applying these rules, the court shall make orders and give directions that are proportionate to the importance and complexity of the issues, and to the amount involved, in the proceeding.

Matters Not Provided For

(2) Where matters are not provided for in these rules, the practice shall be determined by analogy to them. R.R.O. 1990, Reg. 194, r. 1.04 (2).

36Rules 1.05 and 37.13 of the Rules of Civil Procedure empower a judge to impose terms when making an order on a motion. Rule 105 states:

ORDERS ON TERMS

1.05 When making an order under these rules the court may impose such terms and give such directions as are just.

37Rule 37.13 states:

DISPOSITION OF MOTION

37.13 (1) On the hearing of a motion, the presiding judge or officer may grant the relief sought or dismiss or adjourn the motion, in whole or in part and with or without terms, and may, ….

38Classic’s argument for setting aside the registrar’s second dismissal of the appeals is that in July 2018, Mr. Hinic and Ms. Loggie improperly moved without notice to Classic to request the registrar to dismiss the appeals. Further, Classic submits that the registrar did not have the jurisdiction to determine whether (to quote from the registrar’s orders) Classic “has not served or filed new proof that it has ordered transcripts of evidence that the parties have not agreed to omit from a duly accredited court transcriptionist by 4:00 p.m. on June 1, 2018.” Classic submits that inasmuch it filed a filed a certificate (albeit mistakenly the original certificates from 2017), it was not for the registrar to determine whether that filing was in compliance with Justice Myers’ order.

39I do not agree with Classic’s submissions. The registrar was no longer purportedly engaged in the administrative act of just enforcing rule 61.13 (1)-(3), which was the case when the registrar dismissed the appeals in December 2017. The registrar was now engaged in the administrative act, of enforcing Justice Myers’ order and the registrar’s jurisdiction was enlarged by rule 61.13 (3.1), which states:

DISMISSAL FOR DELAY

Motion by Respondent

Registrar to Dismiss where Time Prescribed by Court

(3.1) Where an appellant has not perfected the appeal within the time prescribed by an order of the appellate court or a judge of that court, the Registrar shall make an order in (Form 61I) dismissing the appeal for delay, with costs fixed at $750, despite rule 58.13 and shall serve the order on the parties.

40Justice Myers had directed the registrar to immediately dismiss the appeals if Classic failed to pay security for costs and to file new proofs in each appeal that it had ordered transcripts from an accredited court transcriptionist by June 1, 2018. It is a fact that Classic did not comply with Justice Myers’ order by June 1, 2018, and it did not file a new proof that it has ordered transcripts of evidence. It also did not post security for costs.

41Thus, Classic did not comply with any of the conditions set out in Justice Myers’ order. There was nothing improper in Mr. Hinic and Ms. Loggie filing an affidavit or moving to have the registrar do what the registrar could have immediately done on June 1, 2018.

42Regardless of whether or not Classic made an honest mistake by filing the old certificates of Ordering a Transcript that had been filed in 2017, Classic has - not to this day - ordered the evidence that is required for the appeal in accordance with the exchange of Certificate Respecting Evidence. Classic persists in ignoring the Respondents’ Certificates Respecting Evidence which require that six days – not two days - of the trial proceedings to be transcribed into a transcript.

43I agree with Justice Myers that the content of the appeal record is a matter that must be resolved by the parties before not at the hearing of the appeal. The rules for perfecting an appeal are designed to ensure that the appeal is ready to be argued when scheduled for a hearing. Class persists in not complying with the rules for the perfection of appeals.

44Classic’s self-indulgent and irresponsible approach to perfecting its appeals has already occasioned intolerable waste and delay in access to justice for the parties in Small Claims Court proceedings, which are designed to provide a proportionate civil procedure for the administration of justice in this province. In prosecuting an appeal under the Rules of Civil Procedure, Classic’s approach leads to the least expeditious and most expensive determination of the appeal, the exact opposite of what is called for under Rule 1.04.

45I, therefore, dismiss Classic’s request to set aside the dismissal orders of the registrar.

46As for Classic’s argument for extending the time to challenge Justice Myer’s order, Classic submits that it was entitled to have the registrar’s orders set aside without terms and that Justice Myers was mislead by Mr. Hinic’s and Ms. Loggie’s lawyers into believing that Classic was at fault and into believing that he was granting an indulgence. This submission is without any merit and is just a continuation of Classic’s refusal to take responsibility for perfecting its appeal in accordance to the Rules of Civil procedure. No further indulgences should be granted, and it is time for Classic to be accountable for its failure to follow the rules.

47In any event, in light of my decision not to set aside the registrar’s order, Classic’s request for an extension of time to bring a motion to set aside or vary Justice Myers’ order is moot and should be dismissed on this ground.

D. Conclusion

48For the above reasons, Classic’s motions are dismissed with costs that I fix at $500 each for Mr. Hinic and Ms. Loggie.

Perell, J.