CITATION: Newcastle Salvage Inc. v. 2270739 Ont. Ltd., 2019 ONSC 2810
DIVISIONAL COURT FILE NO.: 97873/16
DATE: 20190506
ONTARIO
SUPERIOR COURT OF JUSTICE
(DIVISIONAL COURT)
BETWEEN:
1745428 Ontario Inc., Doublewin International Corp. and Newcastle Salvage Inc.
Appellants/Defendants
– and –
2270739 Ontario Ltd., Carrying on business as Debt Buyer$
Respondent/Plaintiff
Z. Matthew Kaslik, for the Appellants/Defendants
Mark A. Bumstead, for the Respondent/Plaintiff
HEARD: April 25, 2019
REASONS FOR DECISION
Woodley J.
OvERVIEW
[1] In August of 2015, Quality Mechanical rented a salvage bin from the Defendant Newcastle Salvage for use at their work site, Courtice Secondary School. On August 19, 2015, when the bin was picked up for emptying by Newcastle Salvage, a piece of scrap metal contained inside the bin became caught on overhanging hydro wires and caused damage to those wires.
[2] Due to the nature of the damage Quality Mechanical retained an electrical company present at the work site (Voltage Tech) who repaired the overhead cabling to the portables and who subcontracted the repair of the damaged feed to the portables (Sage Electrical Limited). The electrical work and necessary repairs were completed immediately.
[3] Voltage Tech invoiced Quality Mechanical for the electrical repair work and Quality Mechanical attempted to collect the amount paid for the repairs.
[4] Quality Mechanical was unsuccessful in collecting the funds and on February 29, 2016, Quality Mechanical assigned the debt to the Plaintiff 2270739 Ontario Ltd., carrying on business as Debt Buyer$.
[5] On March 8, 2016, the Plaintiff commenced a claim to recover the invoice as against Doublewin International Corp. carrying on business as Newcastle Salvage. Newcastle Salvage filed a Statement of Defence showing its address for service at a Metcalf Street address. Doublewin filed an Amended Defence denying any and all association with Newcastle. The Plaintiff served an Amended Claim replacing Doublewin with 1745428 Ontario Inc. carrying on business as Newcastle Salvage.
[6] Both 174 and Newcastle Salvage appear on the bin rental tickets associated with the disposal bin.
[7] Newcastle Salvage and Doublewin attended the Settlement Conference.
[8] The trial was heard on September 29, 2019 by Deputy Judge C. Kilian.
[9] A representative from Doublewin and 174 attended the trial as parties. A representative from Newcastle Salvage attended the trial as a witness for Doublewin.
[10] During the course of the trial Judge Kilian dismissed the claim against 174 without costs and added Newcastle Salvage as a party. Judge Kilian found Newcastle Salvage liable for the damage and ordered Newcastle Salvage to pay the Plaintiff the sum of $3304.95 plus costs of $699 plus interest at the Courts of Justice rate from November 9, 2015.
ISSUES
[11] The issues to be determined on this appeal are as follows:
(a) Did the trial judge err in adding Newcastle Salvage as a party to the proceeding at trial?
(b) Did the trial judge err in allowing Bin Liu, Newcastle Salvage’s representative, to testify at trial after Newcastle Salvage had been added as a part?
(c) Was there a denial of Newcastle’s basic procedural and substantive statutory, common law and equitable rights (i.e. a denial of natural justice):
i. In being added as defendants during the trial?
ii. In proceeding with the trial immediately following being added as a defendant?
iii. In finding Newcastle Salvage liable at trial?
iv. As a result of a combination of any one or more of the above factors?
v. Did the method and timing in which the style of cause was amended to add and/or delete Doublewin and 174 result in a breach of natural justice?
vi. Should the fact that oral judgment was granted “without and in the complete absence of written reasons” result in a breach of natural justice?
BACKGROUND
[12] On March 8, 2016, the Plaintiff commenced a Small Claims Court action against “Doublewin International Corp., Carrying on business as Newcastle Salvage”.
[13] On March 23, 2016, Newcastle Salvage served and filed a Statement of Defence to the Plaintiff’s Claim showing an address for service at the Metcalf Street address in Newcastle.
[14] By its’ Defence, Newcastle Salvage confirmed that it is the proper party that rented the disposal bins to Quality Mechanical for delivery to Courtice Secondary School. Newcastle Salvage further acknowledged damage occurred to the wires at Courtice Secondary School on August 19, 2015, but denied liability for the damage. Newcastle Salvage alleged that it was the property owner who was responsible for the damage not Newcastle Salvage.
[15] On March 24, 2016, the court issued a Notice of Settlement Conference, showing the Defendant as “Doublewin International Corp. carrying on business as Newcastle Salvage”. The Notice set the settlement conference for May 11, 2016.
[16] On April 4, 2016, Newcastle Salvage sent a fax on Newcastle Salvage letterhead to the court as follows: “As per our conversation on March 28, 2016, regarding changing the date of the Settlement Conference…please find attached the signed consent form. As discussed, we would like to see the judge on June 23rd as there are changes that need to be made to the name listed as the defendant in this matter. Could you please contact me, to confirm receipt and advise of time, at your earliest convenience. Best regards, Tara Rocchio, Office Manager.”
[17] The Consent (Form 13B) attached to the April 4, 2016 Fax noted the claim as between Debt Buyer$ and Newcastle Salvage Inc. The form is witnessed and signed by the Plaintiff and Newcastle Salvage Inc. The Consent is to “change the date for settlement conference from May 11, 2016 to June 23, 2016”.
[18] On April 6, 2016, the court issued a second Notice of Settlement Conference for June 23, 2016 showing the defendant as “Doublewin International Corp. carrying on business as Newcastle Salvage”.
[19] On April 21, 2016, Doublewin filed an Amended Defence denying any and all association with Newcastle Salvage. Attached to the Amended Defence were the Articles of Incorporation for Doublewin and 1745428 Ontario Inc. that disclosed the directors but not the shareholders.
[20] On April 25, 2017, the Plaintiff served an amended Plaintiff’s Claim, replacing Doublewin with 174.
[21] On June 23, 2016, at the Settlement Conference, the judge made an endorsement allowing the Plaintiff to change the style of cause to remove Doublewin and to add 174 carrying on business as Newcastle Salvage in place of Doublewin.
[22] Newcastle Salvage, Doublewin and the Plaintiff attended the Settlement Conference. Both Defendants were represented by Bin Liu, who appeared as agent for Doublewin and owner of Newcastle Salvage.
[23] On August 10, 2016, the court issued a Notice of Trial showing the defendant as “Doublewin International Corp. carrying on business as Newcastle Salvage”.
[24] On September 6, 2016, the Plaintiff faxed the court office to notify them that the Notice of Trial listed the incorrect defendant.
[25] The clerk or registrar of the court changed the style of cause on the trial list based on the Amended Plaintiff’s Claim.
[26] Doublewin and 174 both appeared at trial. They were represented by an officer of those corporations Tina Li, who testified that Newcastle Salvage was the proper defendant.
[27] Newcastle Salvage also appeared at trial. They were represented by an officer of that corporation, Bin Liu, who testified that Newcastle was the proper Defendant which point had been conceded by the Appellant in its’ Statement of Defence and Factum.
[28] The trial judge canvassed the issue of whether Newcastle Salvage should be added as a party Defendant at trial, confirmed that Newcastle Salvage had filed a Defence, and then added Newcastle Salvage as a Defendant.
[29] Newcastle Salvage, by its representative Bin Liu, advised the trial judge that she was “ready to do the defence”.
[30] Newcastle Salvage, by its representative, Bin Liu, testified at the trial.
[31] Bin Liu told the trial judge that she knew the “whole incident” and that she knew Newcastle Salvage’s defence.
[32] Bin Liu testified that as some date in the past Newcastle Salvage was formed and took over operation for the salvage yard from 174 but did not change the name.
[33] Newcastle Salvage continued to use the same Bin Rental tickets, but instructed the office manager to strike out the numbered company.
[34] All three bin rental tickets bear the following pre-printed text:
Newcastle Salvage
1745428 Ontario Inc.
3753 Metcalf St., RR8, Newcastle, ON L1B 1L9
Phone: (905) 9987 4741 Fax: (905) 9987-1539
[35] None of the three tickets have the numbered company struck out.
[36] Bin Liu testified that the Bin Rental ticket contains the following statement: “customer is responsible for any cost related to overweight or improperly loaded bins”. She asserted that the clause shifted liability for any and all losses, including damage to Newcastle Salvage’s trucks or bins, onto the client.
[37] Bin Liu testified that the wires were too low according to the industry standard. This same claim was contained in the Defence filed by Newcastle Salvage.
[38] Bin Liu made closing arguments.
[39] The trial judge rejected Bin Liu’s arguments, stating that liability was on the driver once he starts loading the load.
[40] The trial judge considered the evidence of Bin Liu and Tina Li, and rejected Newcastle’s arguments against liability, and found Newcastle Salvage liable.
[41] The trial judge issued an oral judgment at the conclusion of the trial as follows:
“First of all, I am satisfied that the numbered company is not responsible for the damage. It is now clear from the evidence that they are not the ones who own the trucks. I have added Newcastle Salvage Inc. as a party defendant because they already filed a defence so there is no prejudice to them.
Now dealing with the arguments by Newcastle Inc. Yes, their contract says that the party is responsible for loading and making sure that the bin is not overloaded, but once the driver starts loading the load the responsibility becomes his because he is shifting the load and it is his responsibility to make sure the load is not sticking out in the top before he moves away. That is his responsibility. Once he pulls that bin onto his truck it becomes his responsibility and in this case the evidence was that the bin was not overloaded, but that once it was on the truck something stuck up from it. At that point it was the driver’s responsibility to say, “No, I am not going to move this load until that thing is changed”. He has a right to do that. He can say, “It is your responsibility to load it properly. It is not loaded properly now. I am not moving it until you fix it.” That was not done here. He moved away and he did damage.
As for the wires not being in the right height, there is no evidence whatsoever directly or indirectly as to what the height of those wires were and certainly if they were too low again, the driver should not have moved the truck. If he had realized that the metal sticking up was going to hit the wires he should not have moved it. So again, that is not an argument.
As to allowing the defendant to make the necessary repairs and getting their own repair people in the evidence was that it was an emergency and it had to be done as quickly as possible and under those circumstances they were correct in hiring somebody who was already on scene and having it fixed immediately rather than waiting and having a delay at getting it fixed.
As a result, I find that Newcastle Salvage Inc. is responsible for the damage and there will be judgment against them for the $3304.95 plus the costs of $699 plus interest at the Courts of Justice rate from November 9th ’15 against the defendants Newcastle Salvage Inc. The claim against 1745428 Ontario Inc. is dismissed without costs.”
SUMMARY OF PROCEEDINGS FOLLOWING TRIAL
[42] Following the trial, further judicial resources were expended on this Small Claims action:
(1) On October 27, 2016, Bin Liu, the representative for Newcastle Salvage, filed a Notice of Appeal dated October 27, 2016 for “Newcastle Salvage Inc., Doublewin International Corp., and 1745428 Ontario Inc.”;
(2) On November 15, 2016, Bin Liu, served a Notice of Appointment of Lawyer after the Registrar advised that the Rules require corporations to retain a lawyer or an Order from the Court;
(3) On January 7, 2017, the Registrar dismissed the Appellants’ Appeal for delay;
(4) On June 9, 2017, the Appellants brought a motion to the Superior Court to set aside the Registrar’s Order dismissing the Appeal for Delay;
(5) On September 27, 2017, Justice O’Connell released his reasons for decision released and granted the Appellants’ motion;
(6) On January 11, 2019 the Plaintiff brought a motion to lift the automatic stay imposed by Rule 63.01(1) which material included an affidavit;
(7) The Appellants sought to cross-examine the author of the affidavit and the Plaintiff brought a motion in the Superior Court refuting the cross-examination which motion was argued sometime in February or March of 2019. (I note that there is no notation in the file as to the result of either the stay motion or the motion to cross-examine); and
(8) On April 25, 2019, the Appeal regarding the Judgment against Newcastle Salvage Inc. in the amount of $3304.95 plus costs and interest was stridently argued by both sides before me.
THE NOTICE OF APPEAL
[43] The Appellants Notice of Appeal as prepared by Bin Liu cites the following grounds for appeal:
i. Amendments to the Plaintiff’s Claim to add some of the appellants on the date of trial and during the trial (Newcastle Salvage) and dismissed without costs (174) or omitted entirely from Judgment other appellants (Doublewin);
ii. Judgment and an award for payment of the full amount of the Respondent’s claims, costs and interest against the non-party to the action Newcastle Salvage Inc., after having added Newcastle as the party Defendant to the Respondent’s action during the Trial;
iii. Improper conduct by the Plaintiff through failure to amend the Claim to omit Doublewin, to add Newcastle Salvage, or to serve its’ Statement of Claim and evidentiary productions to Newcastle and in having the Registrar;
iv. Due to Newcastle Salvage never being properly added as a party Newcastle was at no time permitted to file a Statement of Defence as a party defendant, deliver its responding defence evidentiary documents and materials, add the other further necessary parties to the Action involved in the incident, make its counterclaim as against the Respondent and defend itself as it is entitled by law and in equity; and
v. The Judgment was made without, and in the complete absence of, written reasons.
[44] The Appellants’ Factum as prepared by counsel Z. M. Kaslik cites the following grounds for appeal:
The Appellants’ appeal of the Judgment and trial is based on two fundamental issues.
First the denial of their basic procedural and substantive statutory, common law and equitable rights for their having been at the commencement of the trial which they attended as witnesses;
Added as party defendant to the action;
Put on trial immediately thereafter and on that day; and
Thereafter made liable by the Court for the trial’s judgment to the Respondents.
All without prior notice, in breach of that Court’s rules of practise procedure in the and in breach of the fundamental rules of natural justice.
And Second, the Appellants’ submit that, in any event, the Respondent’s inexplicable conduct at the trial, and to date, of having the Court’s registrar office to have improperly deleted from that day’s trail list the action’s actual named Defendant Doublewin and have placed in its place the then non-party 174 and the then non-party Newcastle Salvage, and without any procedural regard for adding and dismissing parties to an action or an order of the Court, is not in a position at either equity or common law to have the Judgment maintained in its favour.
[45] The Appellants’ Position and Argument as contained at page 7 of the Factum cites the following grounds for appeal:
(a) The Judgment granted against them was without consideration or adherence to their procedural or substantive rights at law and in equity;
(b) The Respondent did not come to trial initially with clean hands and similarly to this Appeal with cleans given its inexplicable conduct in causing the court’s registrar to delete Doublewin from the action and add instead Newcastle Salvage and 174;
(c) The actual merits of the action against the correct and proper Defendants has never been tried by the court and Newcastle Salvage and 174 Appellants have a meritorious defence to such an action if that trial ever occurs; and
(d) Pursuant to s. 101 of the Courts of Justice Act this Honourable court is statutorily made to be a Court of equity and these Appellants’ seek both that equity and the granting of basic and fundamental procedural rights founded in statute, at common law, and the Courts of equity.
REVIEW OF THE LAW AND ANALYSIS
Special Considerations Applicable to Small Claims Court
[46] The inherent costs, time, and demand on judicial resources that have been utilized to deal with this $3304.95 claim to date is staggering.
[47] This dispute has long passed any reasonable or expeditious resolution and has veered sharply into unreasonable, scorched earth litigation. Again, all over $3304.95.
[48] Therefore, to right the path and to provide perspective – I can do no better than to repeat the special considerations applicable to Small Claims Court.
[49] Section 25 of the Courts of Justice Act establishes that:
“The Small Claims Court shall hear and determine in a summary way all questions of law and fact and may make such order as considered just and agreeable to good conscience.”
[50] In furtherance of this principle, Justice Molloy in Peck v. Residential Property Management Inc., [2009] O.J. No. 3064 (Div. Ct.), noted:
“The purpose of Small Claims Court is to provide expeditious and low cost settlement of monetary disputes…this Court is reluctant to interfere with a decision of a Small Claims Court judge on judicial review unless it is an order made without jurisdiction or in breach of the principles of natural justice”.
[51] In the present case there is no question that Judge Kilian had jurisdiction to hear and determine the action. However, the crux of the appeal and the issues raised by the Appellants is whether any order or judgment made was in breach of the principles of natural justice.
The Principles of Natural Justice
[52] In addressing a claim that there has been a breach of the principles of natural justice, a court does not engage in an assessment of the appropriate standard of review. Rather, the court is required to assess whether the rules of procedural fairness have been adhered to given the particular circumstances giving rise to the allegation and the appropriate procedures and safeguards required to comply with the principles of natural justice in the particular circumstances of each case: see London (City) v. Ayerswood Development Corp., [2002] O.J. No. 4859 (C.A.) at para. 10.
[53] The content of the “principles of fundamental justice” was initially explored by Lamer J. (as he then was) in Re B.C. Motor Vehicle Act, supra, at p. 503:
The principles of fundamental justice are to be found in the basic tenets of our legal system. They do not lie in the realm of general public policy but in the inherent domain of the judiciary as guardian of the justice system.
[54] As noted by Appellants, the Supreme Court of Canada in Baker v. Canada (Minister of Citizenship and Immigration), [1999] 2 S.C.R. 817, held as follows:
The values underlying the duty of procedural fairness relate to the principle that the individual or individuals affected should have the opportunity to present their case fully and fairly, and have the decision affecting their rights, interest, or privileges made using fair, impartial and open process, appropriate to the statutory, institutional and social context of the decisions.
[55] The Supreme Court’s reference in Baker that procedural fairness must be appropriate to the statutory, institutional and social context of the decisions is highly relevant in the present case.
[56] When considering the principles of fundamental justice and procedural fairness in the present case – it must be remembered that procedural fairness must be interpreted in accordance with the special considerations that apply to the Small Claims Court.
[57] Bin Liu, the representative for Newcastle Salvage, attended at trial. Tina Li the representative for Doublewin and 174. Tina Li advised Judge Kilian that Bin Liu was “representing Newcastle Salvage”. Bin Liu advised the court that she is the owner of Newcastle Salvage Inc. who is leasing the property from the number company 174. Bin Liu stated “I didn’t receive our company’s name as a defendant, this is why I’m not a defendant, but Doublewin and 174 is our customers”.
[58] The court confirmed with Bin Liu on the record that the original claim naming Doublewin cob as Newcastle Salvage and the amended claim naming 174 cob as Newcastle Salvage was served upon her. Bin Liu stated that the “whole thing happened with Newcastle Salvage Inc. which are already in the mediation court…I want them to correct to make the change for the defendant but … in the mediation I told the judge, I told her exactly who I am and who did this is Newcastle Salvage Inc. and I’m an owner and who did that is my employee…I told in that mediation everything’s there. I don’t know why we just keep doing this. I don’t know, but I’m ready to do the defence anyway for the matter.”
[59] Judge Kilian asks Bin Liu “So you’re saying that the work was done by Newcastle Salvage Inc.?” Answer –“yes”. Question – “They’re the one with the trucks? Answer – “Yes. Everything, the employee and even the email he send, everything he sent to me is Newcastle Salvage Inc. It has nothing to do with the number company. It’s just that I told him in mediation and here’s the note. He knows. The Plaintiff knows who I am and who is he supposed to sue too, but I don’t know why he’s suing my customer”.
[60] Later, during cross-examination, Bin Liu states “That’s fine. I’m not hiding anything. I’m here for the whole case. I’m here for the incident so because you messed up the defendant’s name is not my problem, but I’m still here for the whole defendants, but I need a chance to defence instead of no defence.” The court states “Well, you don’t have to defend because you’re not being sued”. After some discussion the Court states “…So it would appear that at some stage Newcastle with the numbered company Inc. changed to Newcastle Salvage Inc. and no longer 1745428 Ontario Inc. No connection with them, but despite that, they were still using that on their documents and the parties who they dealt with, in this case it was I guess …Quality Mechanical only knew Newcastle Salvage as the numbered company and therefore I don’t have any really any choice but to make the same judgment because that’s who they believed they were dealing with, that they believed did the damage.” Bin Liu then interrupts the Judge and states “I know the whole incident, my defence for this case because the representative here, she doesn’t know anything, but I didn’t know what was happening so I think it’s fair for me to say my part of the story. You hear one part. You didn’t hear the other part. That’s why I’m here. I want to say the incident as a witness because if she – the defendant sitting here, she didn’t know what was going on. She know nothing, but I do know what’s happening. May I have a chance to explain what’s going on?” After some discussion the Judge states “having heard this evidence…I’m not satisfied that you sued the right party here…I can’t really find against the numbered company because they’re not the ones who own the trucks. So I would suggest that you sue the right company.”
[61] It is at this point in the trial that the Plaintiff asks if he could “add them as a defendant?”
[62] Again, after some discussion the Plaintiff advises the Judge “I have a defence already here from Newcastle Salvage Inc.” After some discussion the Judge locates the Defence filed by Newcastle Salvage Inc. in the court file. The Judge then addresses Bin Liu and states “You better come up here again and tell me the rest of your story”. Bin Liu says “Me?” and the Judge says “Yes. You did file a defence…I thought you said you didn’t file a defence”. Bin Liu says “I said I did under the different company.” The Court says “All right. Come up here.” The Plaintiff intervenes and says “then we’ve just added them as a second defendant, Your Honour?” The Judge responds “Yeah, we’ll add them on”.
[63] Bin Liu then re-takes the witness stand. The Judge says “All right. Go ahead now. Tell me why you don’t think that your trucks did the damage”. Bin Liu then provides her testimony in defence of the claim while referencing her Statement of Defence and Schedule A and Schedule B, and the documents attached thereto.
[64] The Plaintiff cross-examines Bin Liu and puts to her the evidence previously provided by the witness present at the scene. Bin Liu recalls the testimony and provides the nub of her defence being that “the witness also said when the bin pick up, the one metal sticking out. It’s not our responsibility. It’s not the driver’s responsibility to make a metal inside the bin”. Bin Liu further stated “So that means the metal is not properly put in the box when the box slip and that makes that metal stick up…that shows the bin is not properly loaded.” When asked why her driver was not present at trial Bin Liu responded “because he no longer work for me”. Later in her testimony Bin Liu advised “…my driver is there because we already ask him what happens…everything’s okay…it’s nothing to do with the driver. The driver didn’t put the metal in the box.”
[65] At one point during cross-examination the Plaintiff suggested to Bin Liu that if she thought it was the school board’s fault she could have brought a defendant’s claim against them. Bin Liu responded “Well, I don’t even know which school – I don’t even know what the relationship with the school board and – it’s not my business. So…I think Quality Mechanic need to sue the school board for all the whole damage because they have low wire there…who put the low wire, that’s the people …you supposed to sue, not us.”
[66] Following the close of Bin Liu’s evidence, the Judge asked for closing statements. The Plaintiff, Tina Li for Doublewin and 174, and Bin Liu, all made closing statements to the court.
[67] Oral reasons for decision were provided to the parties which reasons are outlined above.
Claims Relating to Denial of Natural Justice and Procedural Fairness
[68] As noted by the Ontario Court of Appeal in London, supra, as the Appellants have challenged the fairness of the process the court is required to assess whether the rules of procedural fairness have been adhered to given the particular circumstances giving rise to the allegation and the appropriate procedures and safeguards required to comply with the principles of natural justice in the particular circumstances of this case.
[69] Such an assessment must be completed in a manner that upholds the statutory objectives pronounced by s. 25 of the Courts of Justice Act that provides that Small Claims Court shall hear and determine in a summary way all questions of law and fact and may make such order as considered just and agreeable to good conscience.
[70] Further guidance provides that there should be no interference with a decision unless (in this case) it is in breach of principles of natural justice.
[71] As for the Appellants’ claim that the proceedings leading up to the trial breached procedural fairness and natural justice I note the following:
(a) Newcastle Salvage admitted that they were served with all the Original and Amended Statement of Claim that clearly lists Newcastle Salvage as a Defendant;
(b) Newcastle Salvage was the first Defendant to file a Statement of Defence that included documentary attachments;
(c) Bin Liu, the owner of Newcastle Salvage, signed and filed a Consent (Form 13B) that noted Newcastle Salvage as Defendant to adjourn the settlement conference;
(d) Bin Liu as representative for Newcastle Salvage was the only Defendant representative at the Settlement Conference;
(e) Bin Liu exchanged correspondence with the Plaintiff following the Settlement Conference relating to disclosure and documents; and
(f) Bin Liu personally attended at the trial to “give her defence”.
[72] In the circumstances I do not see any validity to the Appellants’ claim that procedural fairness and natural justice were breached prior to the trial of this action. Further, I do not see any validity to the Appellants’ claim that the Plaintiff acted improperly or without clean hands. Instead, it is apparent that the Plaintiff took all necessary steps to alert the “responsible party” through naming the Defendant Newcastle Salvage on both the original and amended claim. It is also apparent that the Plaintiff’s naming of Doublewin and 174 was due to misinformation provided by the said Defendants either on their website (Doublewin) and/or on the Bin Ticket (174). The Plaintiff sought to ensure that the proper Defendant was named and took appropriate steps to notify the responsible party.
[73] The fact remains that the responsible party (Newcastle Salvage) was in fact notified and was the first party to file a Defence with the Court and submit documents in furtherance of that Defence. The Appellants’ claim that procedural fairness and natural justice were breached leading up to the trial of the action is baseless and is dismissed by me.
[74] As for the Appellants’ claim that the trial itself breached procedural fairness and natural justice I note the following:
(a) Bin Liu attended trial to “give her defence”;
(b) Bin Liu did not object to being added as a party nor did she seek an adjournment after Newcastle Salvage was added as a Defendant;
(c) Bin Liu was not prejudiced in being added as a Defendant at trial as she had received all documents from the Plaintiff when she was served with the original and amended Claim, had filed all documents that she intended to rely upon when she filed the Defence for Newcastle Salvage, had attended the Settlement Conference and attended the trial;
(d) Bin Liu did not intend to add any other Defendants and clearly advised the court that it was the Plaintiff’s responsibility to sue the school board – not hers;
(e) Bin Liu did not intend to call any other witnesses and clearly advised the court that she did not bring her driver as he did not work for her anymore and she had already spoken to him and he did nothing wrong;
(f) Bin Liu was prepared for her testimony and insisted that she be entitled to “tell her story”. The Court added Newcastle Salvage as a party while Bin Liu was in the witness box and allowed her to provide her entire defence;
(g) Bin Liu referenced the Statement of Defence filed by Newcastle Salvage, referenced the documents attached to the Statement of Defence and denied liability on behalf of her company;
(h) Bin Liu was not afforded an opportunity to cross-examine the Plaintiff’s first witness but was present during his testimony. Bin Liu commented on the testimony and clearly stated that the testimony supported her position that the bin was not loaded properly;
(i) Bin Liu was afforded the opportunity to make a full and complete defence on the merits of the action. Bin Liu was also afforded the opportunity to make a closing statement on behalf of Newcastle Salvage.
[75] Having reviewed the transcript of the trial of this matter it is apparent that Judge Kilian proceeded in a manner that was both fair and just and upheld the principles of natural justice throughout the trial. The Judge allowed Bin Liu to make any and all submissions that she thought necessary. He confirmed that Newcastle Salvage had filed a Defence to the action – and he confirmed that Doublewin had been replaced by 174 through the Amended Claim – which was served on Bin Liu for Newcastle Salvage. Most particularly Judge Kilian exercised his discretion in a manner that properly applied the Small Claims Court rules (and in particular Rule 10.03 – that allows a defendant to be added during the trial) while upholding the objectives to be applied to Small Claims Court proceedings.
[76] It is disingenuous for the Appellants to claim that Newcastle Salvage was prejudiced at trial and were added without consideration or adherence to their procedural or substantive rights at law and in equity.
[77] Newcastle Salvage was served with the Plaintiff’s Claim shortly after it was issued on March 8, 2015, at their business premises on Metcalf Street in Newcastle. Newcastle Salvage was named as a party on both the original Claim and the Amended Claim. Newcastle Salvage was the first Defendant to file a Defence. Newcastle Salvage was served with the Notice of Settlement Conference and returned a Consent signed by them that listed their name as a Defendant. In fact, the only parties who signed the Consent were the Plaintiff and Newcastle Salvage as Defendant.
[78] Newcastle Salvage by their own admission was the proper Defendant to the action. Newcastle Salvage was the only Defendant that attended the Settlement Conference on June 23, 2016. At the Settlement Conference wherein the representative at trial, Bin Liu, appeared as owner of Newcastle Salvage and as agent for Doublewin. An Order was obtained that provided for exchange of documents and disclosure requests. Correspondence in the file evidences that Newcastle Salvage corresponded with the Plaintiff regarding exchange of information and disclosure. The Plaintiff confirmed that Newcastle Salvage had all disclosure requested as it was “attached to the claim” that had been served upon Newcastle Salvage upon issuance.
[79] Doublewin filed an Amended Defence that clearly stated that it had no connection to Newcastle Salvage.
Claims Relating to Errors by the Trial Judge
[80] At the trial of the matter the Judge carefully considered the issues and made findings of fact and law that did not favour the Appellant Newcastle Savage. There is simply no merit that the trial judge proceeded unfairly or was not correct in his findings or that he made a palpable or overriding error.
[81] With respect to the absence of reasons, as noted by the Appellants, Justice Bellamy in Vuong v. Toronto East General & Orthopaedic Hospital held as follows:
I recognize that the Small Claims Court is a very, very busy court. However, litigants are entitled to know the reasons why a judge has allowed a motion and dismissed an entire statement of claim. In the absence of any reasons whatsoever, it is impossible for a reviewing court to ascertain whether the motions judge believed the matter was res judicata, whether he believed it was frivolous or vexatious, whether it was an abuse of process or whether it was some combination of the above. It is impossible for a reviewing court to agree with the defendant that the judge took into consideration any of the cases now cited. I am basically faced with the situation where both counsel were before me having to guess as to the precise reasons of the motions judge… There are no reasons whatsoever that would permit appellate review of the correctness of the judge’s decision. In my view, I really have no alternative but to set aside the judge’s decision and remit the matter to the Small Claims Court for the hearing of the motion before a different judge who should be made aware of my decision.
[82] This case, Vuong, clearly does not apply to the proceedings before me. Justice Kilian provided oral reasons that are set out above that provide a concise and clear summary of the issues, the evidence and his findings. There are more than sufficient reasons to permit appellate review of the correctness of the judge’s decision.
[83] The Ontario Court of Appeal in Krawchuk v. Sherbak et al., 2011 ONCA 352, 106 O.R. (3d) 598, establishes that the appropriate standard of review is palpable and overriding error, which means that the trial judge’s findings of fact attract considerable deference.
[84] In the present case I do not find that the judge made any palpable or overriding error nor do I find that the procedures engaged either prior to or during the trial breached the principles of natural justice.
DETERMINATION OF ISSUES
[85] For the reasons for decision provided herein, the issues on this appeal are determined as follows:
(a) The trial judge did not err in adding Newcastle Salvage as a party to the proceeding at trial.
(b) The trial judge did not err in allowing Bin Liu, Newcastle Salvage’s representative, to testify at trial after Newcastle Salvage had been added as a part.
(c) There was no denial of Newcastle’s basic procedural and substantive statutory, common law and equitable rights (i.e. a denial of natural justice):
i. In being added as defendants during the trial;
ii. In proceeding with the trial immediately following being added as a defendant;
iii. In finding Newcastle Salvage liable at trial;
iv. As a result of a combination of any one or more of the above factors;
v. The method and timing in which the style of cause was amended to add and/or delete Doublewin and 174 did not result in a breach of natural justice;
vi. The fact that oral judgment was granted “without and in the complete absence of written reasons” did not result in a breach of natural justice.
[86] Accordingly, the appeal is hereby dismissed.
[87] The Appellant Newcastle Salvage Inc. shall pay costs to the Respondent/Plaintiff fixed in the amount of $3,000.00 to be collected in accordance with the usual practise in the Small Claims Court proceedings.
Woodley, J.
Released: May 6, 2019
Newcastle Salvage Inc. v. 2270739 Ont. Ltd., 2019 ONSC 2810
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Newcastle Salvage Inc. v. 2270739 Ont. Ltd.
REASONS FOR JUDGMENT
Woodley, J.
Released: May 6, 2019