Court File and Parties
CITATION: Elegant Façade Inc. v. Broccolini Construction (Toronto) Inc., 2021 ONSC 6951
DIVISIONAL COURT FILE NO.: 011/21
DATE: 20211018
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
D.L. Corbett J.
B E T W E E N:
ELEGANT FAÇADE INC.
Alex Flesias, for the Responding Party
Appellant/Responding Party
- and -
BROCCOLINI CONSTRUCTION (TORONTO) INC., SIMON HALTON HILLS HOLDING INC., CALLOWAY REIT (HALTON) INC., ROYAL BANK OF CANADA and THE BANK OF NOVA SCOTIA
Asad Moten, for the Moving Party
Respondents/Moving Party
Heard by ZOOM: February 26, 2021
REASONS FOR DECISION
D.L. Corbett J.:
[1] The defendant Broccolini moves to quash the appeal brought by the plaintiff, Elegant, from a decision of Gibson J. dated December 22, 2020 (unreported). Broccolini argues that the order of Gibson J. is interlocutory and that interlocutory appeals are not permitted in actions brought under the Construction Lien Act, RSO 1990, c. C.30 (the “CLA” or the “Act”).
[2] The impugned order is made for production against Doris Hazboun. Elegant says that the order is final because Doris is not a party to the proceedings: so far as she is concerned, the order finally disposes of the only issue in which she is involved, personally, in this case.
[3] Doris Hazboun was put forward as Elegant’s witness on a s.40 examination under the CLA. Although Ms Hazboun is not a party, as a witness in the proceedings, Ms Hazboun is subject to the court’s process. A corporation cannot be examined except by way of an examination of a human being with knowledge of the corporation’s affairs. An order for production and/or reattendance for examination made against a corporation’s witness is not rendered final because that witness is not a party to the proceedings. Different considerations may apply where such an order is made against a person who is a “stranger” to the litigation. Those considerations do not apply here. Therefore, for the reasons that follow, the appeal is quashed.
Background Facts
[4] Broccolini, as general contractor, entered into a subcontract on March 6, 2018 with Elegant, for construction work on a project for which Broccolini was performing work for Simon Halton Hills Holdings Inc.
[5] Elegant is a family-owned business run by George and Doris Hazboun.
[6] Elegant registered a claim for lien in respect to the subcontract on March 18, 2019.
[7] Broccolini sought to cross-examine Elegant on its claim for lien pursuant to s.40 of the CLA.
[8] In its notice of cross-examination, Broccolini named George Hazboun as the witness to be cross-examined on behalf of Elegant.
[9] On December 16, 2019, Elegant’s counsel emailed Broccolini’s counsel stating that “it will be Doris Hozboun that is the representative of Elegant that will be examined as she has the most knowledge regarding the quantum of the lien.”
[10] Broccolini accepted Doris Hazboun as the witness for Elegant, as proposed by Elegant’s counsel, and the cross-examination was conducted on January 29, 2020. Various questions were refused during the cross-examination. Further proceedings ensued, among which Broccolini brought an “omnibus motion” to reduce Elegant’s claim for lien and for an order for security for costs. Elegant has resisted the omnibus motion and has delivered an affidavit from Doris Hazboun in support of its position on that motion. Broccolini cross-examined Doris on her affidavit, and during that cross examination various questions were refused.
[11] Broccolini moved to compel answers to questions refused at the s.40 cross examination and during the cross examination on Doriz Hazboun’s affidavit.
[12] By decision dated December 20, 2020, Gibson J. ordered as follows (among other things) (at paras. 13-14):
Doris Hazboun shall answer the refusals set out in the chart attached as Schedule “A” to Broccolini’s Notice of Motion dated November 9, 2021.
Doris Hazboun shall re-attend at her own expense to answer the refusals, and any proper question arising from the answers to the refusals.
[13] In his reasons, the motions judge stated, correctly, that the motion was brought to require Elegant to provide documents and to answer questions (para. 1). The motions judge noted that the argument opposing the requested relief was made on behalf of Elegant (para. 3).
[14] On January 6, 2021, Elegant served a notice of appeal. Doris Hazboun did not purport to appeal the order of Gibson J.
[15] Broccolini, by its counsel, immediately advised Elegant that the order of Gibson J. was interlocutory and thus that there was no right of appeal from it. Elegant did not respond. By email from Divisional Court staff dated January 7, 2021, Justice Favreau directed Elegant to explain why the impugned order is a final order. Elegant responded as follows:
[t]his matter is a final Order on the basis that Justice Gibson’s Order requires a non-party (Doris Hazboun) to, inter alia, produce documents and to attend for examination at her own cost.
[16] The sole issue on appeal is whether the impugned order is final or interlocutory: the parties agree that the CLA applies to this case as it read on June 30, 2018 (that is, before amendments pursuant to which the Act was renamed the Construction Act, and various amendments were made, including respecting the availability of appeals from interlocutory orders, with leave). See CLA, s.87.3(1)(a).
[17] If the impugned order is interlocutory then there is no appeal available: CLA, s.71(3): “no appeal lies from… (b) an interlocutory order made by the court.”
[18] Production and disclosure orders are generally interlocutory. However, where a production or disclosure order is directed against a “stranger to the litigation”, the order is final, in respect to that person.
[19] In the case at bar, Doris Hazboun has been directed to provide production and disclosure in her capacity as a representative of and witness for the plaintiff. She has no role in the proceeding other than as the plaintiff’s representative and witness. Of course, in being tendered as a witness by the plaintiff and in providing an affidavit, she has put herself before the court as a witness and must abide by the court’s orders.
[20] The wording of the order – directed as it is to Doris Hazboun – does not transform an interlocutory order against the plaintiff into a final order against Doris Hazboun. See Callidus Capital Corporation v. Opes Resources Inc., 2019 ONCA 212, para. 5. See also Density Group Limited v. HK Hotels LLC, 2017 ONCA 205. The cases relied on by Elegant are all situations where the impugned order concerned a true “stranger to the litigation”: Smerchanski v. Lewis (1980), 30 OR (2d) 370 (Ont. CA) (subpoenas directed at public regulators not parties to the proceedings); Morse Shoe (Canada) Limited v. Zellers Inc. (1997), 10 CPC (4th) 390 (an order directed at a party’s bank); Canwest Media Networks Inc. v. Canada (Attorney General), 2007 ONCA 567 (subpoena directed at a non-party). The Court of Appeal declined to limit the principle in Smerchanski when invited to do so in Canwest. But the Court did not extend the principle to catch situations where production and disclosure orders are made against the human representatives of a corporate party who have been put forward by that party as the party’s witness.
[21] Corporations are legal persons but can only be examined by way of examinations of natural persons. In this case, Doris Hazboun was proposed as the representative of the plaintiff by the plaintiff itself. She voluntarily undertook this role with the approval of the plaintiff. She voluntarily provided an affidavit for the plaintiff. There is no basis to distinguish the role of Doris Hazboun from the role of the plaintiff, for the purposes of examination and production. There are situations where persons who are not so closely identified with a party are ordered to make disclosure – such as an order for banking records, records from independent professional advisors, and the like. In some of those cases, where the order for disclosure crosses over from matters over which the party has control to matters where the private interests of the third person are implicated, that third party may well have a separate interest in the outcome. However, in that situation, it is not the party that has standing to assert the independent interests of the “stranger” to the litigation, but the “stranger” herself. Doris Hazboun has not brought this appeal. She has not asserted a personal interest in the outcome of the disclosure and production issues – either on the motion below or on this appeal.
[22] Finally, since this appeal is not brought by Doris Hazboun, Elegant has no standing to assert the personal interest of Doris Hazboun in the impugned order. If Ms Hazboun had wished to challenge the order because it finally disposes of her personal interest in making disclosure and providing production, it would have been for her to bring the appeal in her own name, and thus to expose herself personally to the risk for costs.
Disposition
[23] The order of Gibson J. is interlocutory. It may not be appealed. The motion is granted and the appeal is quashed. In my view the position of the appellant was so devoid of merit as to warrant substantial indemnity costs, which I fix at $10,000, inclusive, payable by Elegant to Broccolini within thirty days.
D.L. Corbett J.
Released: October 18, 2021
CITATION: Elegant Façade Inc. v. Broccolini Construction (Toronto) Inc., 2021 ONSC 6951
DIVISIONAL COURT FILE NO.: 011/21
DATE: 20211018
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
D.L. Corbett J.
BETWEEN:
Elegant Façade Inc.
Appellant/Responding Partylicant
- and –
Broccolini Construction (Toronto) Inc., Simon Halton Hills Holdings Inc., Calloway REIT (Halton) Inc., Royal Bank of Canada and The Bank of Nova Scotia
Respondents/Moving Party
REASONS FOR DECISION
D.L. Corbett J.
Released: October 18, 2021