Court of Appeal for Ontario

Citation: Mascioli v. Unilux Boiler Corp., 2008 ONCA 344

Date: 20080502

Docket: C47864

Before: O’CONNOR A.C.J.O, WATT J.A. and HACKLAND J. (ad hoc)

Between:

BERARDINO MASCIOLI

Appellant/Plaintiff

and

UNILUX BOILER CORP., UNILUX VFC CORP. and ANTONELLA SALATI

Respondents/Defendants

And Between:

UNILUX BOILER CORP. and UNILUX V.F.C. CORP.

Respondents/Plaintiffs by Counterclaim

and

BERARDINO MASCIOLI, REMO SALATI and MARIA SALATI

Appellant/Respondents/Defendants by Counterclaim

Counsel:

Ronald Lachmansingh for Berardino Mascioli

Adrian C. Lang and Sarah Nisker for Unilux Boiler Corp.

Heard and released orally: April 29, 2008

On appeal from the Order of Justice Susan E. Greer of the Superior Court of Ontario dated April 23, 2007 sitting as a Divisional Court Judge hearing an Appeal from the Order of Master Graham dated September 25, 2006.

ENDORSEMENT

[1] On an appeal from a decision of the Master, the appeal judge upheld the denial of the appellant’s application to amend his statement of claim to include a plea that the agreement in issue was based on an illegal consideration. The Master had refused the amendment on the basis that a judge on a motion for an interlocutory injunction in this proceeding had already ruled that the allegation of illegal consideration did not raise a triable issue and the proposed amendment was therefore an abuse of process. The Master had stated:

A motion at any stage to add pleadings that have already been demonstrated not to raise a triable issue is an abuse of process.

[2] The appeal judge agreed with the Master and added that the evidentiary record before her (the appeal judge), clearly showed that there never was any illegal consider-ation for the agreement.

[3] In our view, the courts below erred. The jurisprudence establishes that the refusal to grant an interlocutory injunction on the basis that the applicant has not raised a triable issue, is not a final determination of the issues involved. A motion judge in this situation makes a preliminary decision, nothing more. In particular, the refusal to grant an interlocutory injunction does not finally determine the cause of action, see the judgment of this court in Goodwin and Newman reported at 21 C.P.R. (3d) p. 260.

[4] That being so, it would only be the rare case where a decision to refuse an interlocutory injunction would provide a basis for concluding that it would constitute an abuse of process to proceed with a claim. The respondent argued that this case falls within this rare exception or category because the proposed pleading is, as it was put, “demonstrably and patently false to the knowledge of the pleading party”.

[5] We do not accept the respondent’s argument. While it is true that there was an extensive record before the appeal judge, primarily originating from the injunction motion tending to support the respondents’ position that there was no illegal consider-ation, the fact is that there has not yet been full production and discovery. By virtue of the Rules of Civil Procedure, challenges based on a lack of evidence may be brought at a relatively early stage of the proceedings (see, for example, Rule 20), but not before the close of pleadings.

[6] In our view, the errors arising from the decisions below are properly characterized as errors of law and therefore the standard of review in this court is correctness.

[7] Accordingly, the appeal is allowed and the orders below are set aside. The appellant is granted leave to amend his statement of claim to plead the proposed paragraphs 7(e) and 12(e). Nothing in these reasons should be interpreted as precluding the respondents from bringing a summary judgment application at the appropriate time should they see fit, nor should the reasons be read as suggesting that this court has found evidence supporting the plea of illegal consideration.

[8] The respondent shall pay the appellants’ costs as follows:

Motion before the Master $2,000.00

Appeal to the Divisional Court $3,500.00

Application for Leave to this Court $2,000.00

This Appeal $6,000.00

All amounts are inclusive of disbursements and GST and are to be paid within 60 days.

“D. O’Connor A.C.J.O.”

“David Watt J.A.”

“Charles Hackland J. (ad hoc)”