CITATION: Barros v. Jimenez, 2025 ONSC 2937
DIVISIONAL COURT FILE NO.: 565/24
DATE: 20250515
ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT
BETWEEN:
James Barros and Monica Clavijo
Appellants
– and –
Michael Jimenez and Cynthia Parra
Respondents
Howard Reininger, for the Appellants
Gerald Sternberg, for the Respondent, Cynthia Parra
HEARD via videoconference: May 13, 2025
O’Brien J.
REASONS FOR DECISION
Overview
[1] The appellants appeal from an order of Associate Justice Josefo dismissing their motion seeking to withdraw admissions from their statement of defence and counterclaim in the underlying action. The underlying dispute is between two couples over the ownership of a home. The respondent plaintiffs lived at the property and assert they owned it. The property is registered in the name of the appellants.
[2] The disputed paragraphs in the statement of defence say that the respondents signed two “holographic agreements” with the appellants relating to the property. The appellants argued on the motion that there was never a written agreement regarding the property.
[3] The motion judge dismissed the request to withdraw the admissions about the existence of two signed holographic agreements. He addressed the test in r. 51.05 of the Rules of Civil Procedure, R.R.O. 1990 Reg. 194. and concluded “there was no compelling or reliable evidence that the admission was inadvertent or resulted from wrong instructions.” He stated he had seen “nothing approaching a reasonable explanation for the attempted change in position.” The motion judge also concluded the respondents would be prejudiced by the withdrawal of the admissions given that the case involves land ownership and the Statute of Frauds provides that agreements dealing with the sale of land must be in writing.
[4] The appellants submit the motion judge erred in considering evidence from the appellant Ms. Clavijo’s cross-examination. The motion judge relied on the evidence in support of his view that there was no convincing evidence the admissions were inadvertent. The appellants also submit the motion judge erred in applying the test for the withdrawal of admissions and in particular in finding the respondents may suffer prejudice.
[5] The appellants raise an additional issue that can be disposed of summarily: They submit the motion judge erred in neglecting to address the appellants’ request to amend their pleadings, as distinct from their request to withdraw admissions. The motion judge stated in his endorsement that he did not understand the appellants to be pursuing that request. However, in a subsequent endorsement dated September 16, 2024, the motion judge expressly granted the appellants leave to pursue the issue afresh. There is therefore no need to address this issue on appeal.
[6] The respondents submit this court does not have jurisdiction over the appeal because the motion judge’s order was interlocutory. An appeal from an interlocutory order of an associate judge lies to the Superior Court of Justice under s. 17(a) of the Courts of Justice Act, R.S.O. 1990, c. C. 43.
[7] For the following reasons, I conclude that the order under appeal is interlocutory and therefore lies to the Superior Court of Justice. However, I am able in any event to decide the appeal as a Superior Court judge and have done so. On the merits, I do not find any error in the motion judge’s decision.
Is the appeal within the jurisdiction of the Divisional Court?
[8] The respondents submit this appeal is not within the Divisional Court’s jurisdiction because the order addressed a pleading amendment and did not finally dispose of the matter. The appellants disagree. They submit the order is final because it forever bars them from putting forward a defence.
[9] I agree with the respondents. The two paragraphs that were sought to be withdrawn contained factual admissions about the parties entering into two written agreements. They were not allegations as to the appellants’ legal position. Unlike in Canadian Imperial Bank of Commerce v. Lido Drywall Inc., 1995 CarswellOnt 2359 (Div. Ct.), where the defendants were not permitted to validate an entirely new statement of defence, the appellants here have not shown how the factual admissions in the two disputed paragraphs foreclose any particular legal defence. On this basis, in my view, the appeal should have been brought in the Superior Court of Justice.
[10] However, I am also a judge of the Superior Court of Justice and, as a matter of efficiency, will decide the appeal in that capacity. To the extent it is necessary to do so, I grant the appellants an extension of time with respect to filing this appeal in the Superior Court of Justice, since an appeal of an interlocutory order must be filed within seven days under r. 62.01(2) compared to 30 days for an appeal from a final order to the Divisional Court under r. 61.04.
Did the motion judge err in relying on Ms. Clavijo’s cross-examination transcript?
[11] The appellants submit the motion judge erred in relying on a portion of the transcript from Ms. Clavijo’s cross-examination. They submit the transcript was not filed in evidence and they did not have notice it would be relied on. This means they did not have the opportunity to provide responding evidence.
[12] I do not find any error in the motion judge’s reliance on the transcript. It was well within his discretion to admit and rely on the evidence. The portion of the transcript he admitted contained the questions at the outset of Ms. Clavijo’s cross-examination on June 9, 2021. This was several months after the statement of defence was delivered. At the cross-examination, Ms. Clavijo agreed she had given her lawyer information that he had used to prepare the defence, that she reviewed the defence before it was served, and that the defence remained correct on the date of the cross-examination. The motion judge relied on this evidence to dismiss the suggestion Ms. Clavijo misunderstood the meaning of a holographic agreement or of anything else in the defence.
[13] There was no unfairness in relying on the transcript. As the motion judge found, the transcript was referenced in the responding record and the responding factum on the motion. The appellants therefore were on notice it was being relied on. Although the transcript itself was not filed, counsel for the appellants had a copy of it. It was the transcript of his own client’s evidence. In addition, contrary to the appellants’ argument, r. 34.18 places obligations on a party for filing transcripts but does not override the motion judge’s discretion to accept a portion of the transcript into evidence.
[14] In response to the argument that the appellants did not have the opportunity to file responding evidence, the only evidence they identified as responsive was a letter that they did in fact rely on and that the motion judge considered. It was a letter from former counsel for the appellants in September 2021. The letter stated the appellants did not admit the documents were signed and suggested the words “if it” should have been included in one of the disputed paragraphs of the defence.
[15] The motion judge found this evidence unpersuasive for a number of reasons. He said that it did not address the whole of disputed paragraph 16 of the statement of defence, that it only addressed one of the two disputed paragraphs, and that the letter did not expressly resile from the evidence under oath on cross-examination. In these circumstances, it was open to the motion judge to find the evidence unpersuasive. He committed no palpable and overriding error in doing so.
[16] Overall, the appellants have not demonstrated any legal error, error of principle, or palpable and overriding error in admitting and accepting the transcript evidence as persuasive.
Did the motion judge err in concluding the appellants may be prejudiced by the withdrawal?
[17] The appellants also submit the motion judge erred in applying the test for the withdrawal of admissions. I disagree.
[18] A party seeking to withdraw an admission must satisfy the following three elements: (1) that the proposed amendment raises a triable issue; (2) that the admission was inadvertent or resulted from wrong instructions; and (3) that the withdrawal will not result in prejudice that cannot be compensated for in costs: University Plumbing v. HTS Engineering and others, 2014 ONSC 1521, at para. 8
[19] Although the motion judge did not address the first step of the test, he found the other steps of the test had not been met. The appellants challenge the motion judge’s conclusions. With respect to the second requirement, that the admission be inadvertent or resulting from wrong instructions, they rely on their submissions about the cross-examination transcript and the subsequent letter from counsel. I concluded above the motion judge made no error in principle or palpable and overriding error in his assessment of this evidence. On the evidence before him, it was open to him to conclude the appellants had not shown the admissions were inadvertent or resulted from wrong instructions.
[20] This is sufficient to dispose of the appeal, since a party seeking to withdraw admissions must satisfy all three elements of the test. However, for completeness, I also would not intervene in the motion judge’s treatment of the third part of the test.
[21] The appellants argue the motion judge erred in concluding the respondents faced prejudice. They reject the motion judge’s conclusion that the respondents could be prejudiced because the Statute of Frauds requires that agreements about the sale of land be in writing. The appellants submit they have not pleaded the Statute of Frauds and that this would be required for them to rely on it.
[22] In my view, it was open to the motion judge to conclude this aspect of the test had not been met. First, if the motion judge had permitted the withdrawal of the admissions, the appellants may then have sought to amend their defence to plead the Statute of Frauds. Second, the onus lay on the appellants to demonstrate the respondents would not be prejudiced, not on the respondents to show prejudice. The motion judge was not persuaded they did so. He concluded overall that the appellants were seeking a tactical advantage by attempting to allege entirely new facts over 39 months after they filed their defence.
[23] The motion judge’s application of the test is entitled to deference: University Plumbing, at para. 13. The appellants have not established a basis for this court to intervene in his exercise of discretion.
[24] The appellants also submit the motion judge erred in granting costs of $13,560 considering he did not decide the entirety of the motion before him. It was open to the motion judge to award this amount. It was the partial indemnity amount claimed in the respondents’ bill of costs. Even if, at the motion, the appellants briefly referred to the additional issue of amending the pleadings regardless of whether the admissions were withdrawn, it is clear from the motion judge’s reasons, as well as from the material filed on this appeal, that little time was spent on this point.
Disposition
[25] The appeal is dismissed. The respondents are entitled to their costs of the appeal in the amount of $11,000 all-inclusive.
___________________________ O’Brien J.
Released: May 15, 2025
CITATION: Barros v. Jimenez, 2025 ONSC 2937
DIVISIONAL COURT FILE NO.: 565/24
DATE: 20250515
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
BETWEEN:
James Barros and Monical Clavijo
Appellants
– and –
Michael Jimenez and Cynthia Parra
Respondents
REASONS FOR DECISION
O’Brien J.
Released: May 15, 2025