Court File and Parties
COURT FILE NO.: 04-CV-271812-PD1
DATE: 20120214
SUPERIOR COURT OF JUSTICE – ONTARIO
RE: MAUREEN RICHARDSON , Plaintiff
AND:
MICHAEL KIMBERLEY, ROOPLAL SABHA (DECEASED), aka RALPH SABHA, RIAD SABHA, NERISSA SABHA and NATASHA VARJACIC
BEFORE: Stinson J.
COUNSEL:
Maxim Kaploun , for the plaintiff, responding party
Raj Anand , for the defendant, Michael Kimberley, moving party
Shana Dale, for the defendants, Riad Sabha and Nerissa Sabha, moving parties
No one , for the defendant, Rooplal Sabha, aka Ralph Sabha
None, for the defendant, Natasha Varjacic
HEARD: January 18, 2012
ENDORSEMENT
[ 1 ] This endorsement concerns two motions seeking orders dismissing this action for delay, one brought by the defendant Michael Kimberley and the other brought by the defendants Riad Sabha and Nerissa Sabha ("Riad and Nerissa"). The defendant Natasha Varjacic took no part in the motion. The defendant Rooplal Sabha a.k.a. Ralph Sabha ("Rooplal") died on May 23, 2011. To date, no order to continue has been obtained pursuant to rule 11.02 and thus, pursuant to rule 11.01, the proceeding is stayed as against Rooplal. His estate was not represented at the motion.
background
[ 2 ] This action was commenced on July 2, 2004. It claims damages in the amount of $52,531.85. According to the statement of claim, the complaint arises from a real estate transaction that was completed in September 2003. The plaintiff was the vendor of the property pursuant to a power of sale and Riad and Nerissa were the purchasers. Rooplal, who was the father of Riad and Nerissa, acted on their behalf with respect to the purchase of the property.
[ 3 ] Michael Kimberley was the Toronto solicitor retained by the plaintiff to act for her in the sale of the property. The pleadings indicate that he acted for both the vendor and the purchasers. The statement of claim alleges that Riad and Nerissa remain indebted to the plaintiff for the amount of $52,531.85, reflecting the difference between the purchase price and the mortgaging obtained. The statement of claim further alleges that the plaintiff had expected that her lawyer, Mr. Kimberley, would secure this debt obligation on title, but he failed to do so. The statement of claim goes on to allege that Mr. Kimberley was negligent, had a conflict of interest and breached his fiduciary duty to the plaintiff.
[ 4 ] After the statement of claim was served upon them, the three Sabha defendants filed a joint statement of defence on August 3, 2004. On August 13, 2004, Mr. Kimberley filed a statement of defence, which was amended on September 10, 2004. Since that date, with the exception of a 2006 amendment to the statement of claim to add Ms. Varjacic as a co-defendant on consent, no substantive steps have been taken in the action.
[ 5 ] In November 2006, the court issued a notice that the action would be dismissed within 90 days if it was not set down for trial or disposed of by final order of court judgment. On May 18, 2007, the registrar made an order dismissing the action under rule 48.14.
[ 6 ] The plaintiff subsequently moved to set aside the order of dismissal. In reasons released on June 4, 2008 (reported at [2008] O.J. No. 2178 ), Justice D.A. Wilson held (at para. 7) that "[t]his is not a case where it can be argued that the action was dormant for a significant period of time." She accepted the plaintiff's evidence that "there was inadvertence by counsel, … and changes in counsel, all of which led to delay." Finally, Justice Wilson held (at para. 8) that "there is no demonstrable prejudice to the defendants nor can they argue they believed the Plaintiff had abandoned the action." In the result, Justice Wilson ordered the registrar's order set aside, and directed that a case conference with a Master be arranged within 60 days so that a timetable could be established.
[ 7 ] When Ms. Richardson commenced the action in 2004, she was self-represented. In June 2006, she appointed a lawyer. In October 2006, her first lawyer was removed from the record by order of the Master. She then served a Notice of Appointment of Lawyer, naming Mr. Loftus Cuddy as her lawyer of the record. Mr. Cuddy was the plaintiff's lawyer at the time the action was administratively dismissed in 2007. He appeared on her behalf and argued the motion before Justice Wilson in June 2008. Immediately following Justice Wilson's decision in June 2008, counsel for Mr. Kimberley wrote to Mr. Cuddy advising of available dates for the case conference that Justice Wilson had ordered to be held within 60 days. No case conference was arranged. In November 2008, counsel for Mr. Kimberley contacted Mr. Cuddy due to the fact that she had been unable to schedule a case conference, because the order of Justice Wilson had not been entered. Mr. Cuddy advised that he would circulate the draft order within a few days. He did not do so until February 2009. Counsel for Mr. Kimberley responded the next day with her approval of the draft order.
[ 8 ] In May 2009, Mr. Cuddy circulated the same draft order. It was approved the same day. In June 2009, Counsel for Mr. Kimberley wrote to Mr. Cuddy, requested a copy of the order as entered and reminded Mr. Cuddy of the need to schedule a case conference. There was no response.
[ 9 ] In August, October, and December 2009 and again in March 2010, Counsel for Mr. Kimberley again wrote to Mr. Cuddy repeating her concerns about the plaintiff's failure to provide the order as entered. The order was not forthcoming nor was there any reply or other communication from Mr. Cuddy. No case conference was arranged. The order has never been issued and entered.
[ 10 ] In August 2011, more than two years after the last correspondence from Mr. Cuddy in May 2009, counsel for Mr. Kimberley discovered, on the public view terminal at the courthouse, that the plaintiff was listed as "unrepresented" and that the Notice of Appointment of lawyer from Mr. Cuddy had never been filed.
[ 11 ] On September 1, 2011, counsel for Mr. Kimberley wrote to Justice Wilson's assistant requesting an attendance before Justice Wilson, in light of the fact that her June 4, 2008 order had never been taken out and reciting that the plaintiff had not taken any further steps in the action. A copy of the letter was sent to Mr. Cuddy and to Ms. Richardson personally. Justice Wilson declined the request for an appearance. On September 28, 2011, counsel for Mr. Kimberley wrote to Ms. Richardson advising that he would be bringing a motion on December 20, 2011. In a telephone discussion on September 28, 2011, Ms. Richardson's husband advised that he and Ms. Richardson were in the process of retaining new counsel.
[ 12 ] By November 25, 2011, no new lawyer had gone on the record for Ms. Richardson. As a result, on that day counsel for Mr. Kimberley served his material on this motion to dismiss for delay. Counsel for the co-defendants Riad and Nerissa also decided to bring a motion regarding the same issue. In order to permit both motions to be heard together, the December 20 date was adjourned to January 18, 2012. Ms. Richardson had sought a date after January 25, 2012 to allow them to retain counsel, but this request was declined by the moving parties.
[ 13 ] It was not until January 9, 2012 that current counsel for Ms. Richardson served a Notice of Appointment of Lawyer on her behalf. He proposed to defendants' counsel a resolution of the motion scheduled to be heard on January 18 and advised that, if no resolution was possible, he would be seeking an adjournment to prepare. On January 10, 2012 counsel for Riad and Nerissa responded that his proposed solution was not acceptable and he had instructions to proceed on the scheduled motion date.
[ 14 ] The motion came on for argument on January 18, 2012. Counsel for Ms. Richardson requested an adjournment. After hearing submissions from the parties, I declined that adjournment request. My reasons for doing so are set out below.
[ 15 ] In addition to the foregoing procedural history, a very important development occurred on May 23, 2011, when the defendant Rooplal Sabha a.k.a. Ralph Sabha, the father of the defendants Riad and Nerissa, died. At the time of his death, given the failure of the plaintiff to advance the case, he had not been examined for discovery, and thus there is no evidentiary record concerning his involvement in the events in question.
the adjournment request
[ 16 ] The defendants' motions to dismiss for delay came on for argument on January 18, 2012. Counsel for Ms. Richardson requested an adjournment. I concluded that an adjournment was not warranted, with reasons to follow. I directed that the motions should be argued as scheduled. My reasons for declining the adjournment request are set out below.
[ 17 ] As it is apparent from the detailed procedural history that I have recited above, this action concerns a real estate transaction that took place in September 2003, more than eight years ago. The action itself was commenced in July 2004. Over the succeeding seven and half years, no steps were taken by the plaintiff to advance the case as against the moving defendants after the initiation of the action, despite the plaintiff's retainer of two different lawyers. The action was dismissed for administrative reasons in mid-2007 and was not restored until June 2008. At that time an order was made directing that a case conference be held within 60 days. Not only was the case conference never held, but the plaintiff never had the order setting aside the dismissal issued and entered.
[ 18 ] More than three years passed, with repeated requests by counsel for Mr. Kimberley to move the matter forward. Nothing was done. The plaintiff was certainly aware of status of the matter as of early September 2011. Later that month she was made aware that the defendant Kimberly would be bringing a motion in December 2011. Still she did nothing.
[ 19 ] Despite that advance knowledge, by November 18, 2011, the plaintiff had not formally retained counsel. She was served with the motion materials and was also made aware of the new return date of January 18, 2012. Counsel for the moving parties indicated their intention to proceed on January 18. The motion was a serious and important one.
[ 20 ] Despite the foregoing, it was not until January 9, 2012 that new counsel for the plaintiff was finally retained. This was over four months after the plaintiff was made aware of the fact that Mr. Cuddy had done nothing to advance the case, and more than three months after she first learned of Mr. Kimberley's planned motion.
[ 21 ] It is therefore apparent that the plaintiff had ample notice and opportunity to retain new counsel. Instead of doing so expeditiously, she waited until the last minute.
[ 22 ] It is also telling that between September 2011 and January 2012 the plaintiff took no steps to deal with the case. She was aware that the order of Justice Wilson had not been taken out, but she took no steps to do so herself. She was aware that the defendant Kimberley was intending to bring a motion, but took no steps to advance the case or schedule a case conference. Even after the motion materials were served, she did not take any active steps to respond, save to retain a new lawyer less than ten days before the motion date.
[ 23 ] As I have noted above, on January 10, 2012, counsel for Riad and Nerissa made it plain to newly retained counsel for Ms. Richardson that he intended to proceed with the motion. Counsel for Mr. Kimberley subsequently advised that his client took the same position. Despite the foregoing, counsel for Ms. Richardson filed no substantive material in response to the motion to dismiss, even though he was aware that the moving parties intended to proceed.
[ 24 ] In my view, Ms. Richardson had ample time to address this case between September 2011 and January 2012. She failed to do so. This failure followed more than three years of inactivity on her part, which was preceded by several previous years of inaction. To grant her request for an adjournment of the motion would be to delay matters even further. Given her failure to advance her case at all over the past seven years and her failure to take any steps in the four months leading up to the motion, I concluded that she had displayed disregard for the processes of the court. Therefore, in the exercise of my discretion, I declined her request for an adjournment of the motions.
the motions to dismiss for delay
[ 25 ] Pursuant to rule 24.01, a defendant who is not in default may move to have an action dismissed for delay where the plaintiff has failed to set the action down for trial within six months after the close of pleadings. That prerequisite is plainly met here. The courts have prescribed parameters for when such relief should be granted, however. Among the cases where such principles are articulated are Armstrong v. McCall, 2006 17248 (ON CA) , [2006] O.J. No. 2055 (C.A.), Christie Corp. v. Lee (1999), 29 C.P.C. (4 th ) 181 (Ont. C.A.) , and Belanger v. Southwestern Insulation Contractors Ltd. (1993), 1993 5503 (ON SC) , 16 O.R. (3 rd ) 457 (Gen. Div.).
[ 26 ] In Belanger (which was approved in Christie Corp. and in Armstrong , Borins J. said as follows (at p. 471-472):
In order to succeed on a motion to dismiss a plaintiff's claim for delay the defendant must establish that the delay has been unreasonable in the sense that it is inordinate and inexcusable and that there is a substantial risk that a fair trial will not be possible for the defendant at the time the action is tried if it is allowed to continue. The second part of this proposition is often expressed as the likelihood of prejudice to the defendant giving rise to a substantial risk that a fair trial will not be possible when the case is actually tried. Examples of prejudice are the death of a witness, the inability to locate a witness, the inability of a witness to recall important facts or the loss of important evidence. In determining whether the delay has been unreasonable the court should consider the issues raised by the case, the complexity of the issues, the explanation for the delay and all relevant surrounding circumstances. In considering whether the defendant has sustained prejudice the court should consider the availability of its witnesses, whether the evidence is largely documentary or based on the recollection of individuals, the efforts made by the defendant to preserve its evidence and any other relevant consideration. Prejudice to the defendant is to be considered relative to the time the case will likely be reached for trial if permitted to proceed. The court will then balance the right of the plaintiff to proceed to trial with the defendant's right to a fair trial and make its decision: [authorities omitted].
[ 27 ] Dealing first of all with the delay, it is now more than eight years since the transaction and more than seven since the action was commenced. This is not a complex case, yet the plaintiff has done nothing to advance it. Given the lack of production and discovery, and the need for expert evidence on the solicitor's negligence issue, it is likely that a trial date is still many months away. In my view, the delay is unreasonable.
[ 28 ] In relation to the prejudice question, the basic submission of the moving defendants is that they have been irreparably prejudiced and their right to a fair trial compromised by reason of the death of Rooplal. The plaintiff responds that the absence of Rooplal has no bearing on the solicitor's negligence claim against Mr. Kimberley; in any event, the submission continues, since Riad and Nerissa were the actual purchasers, they are in a position to defend the action, despite the death of their father.
[ 29 ] As noted in Belanger , I am required to balance the right of the plaintiff to proceed to trial with the defendants' right to a fair trial. The plaintiff in her statement of claim recites that at all times she acted through her husband, James Richardson, who held a power of attorney authorizing him to deal with all matters involving the property. The statement of claim further recites that Rooplal acted on behalf of his children with respect to the purchase of the property. It goes on to recite that Rooplal arranged with James Richardson to have the plaintiff provide the balance of the funds required by Riad and Nerissa to close the transaction. The pleading goes on to recite that Mr. Kimberley's understanding was that Rooplal was loaning his children the money to complete the transaction, and that Mr. Richardson and Rooplal were to "tidy up their matter regarding the credit between themselves at a later date."
[ 30 ] In his statement of defence, the defendant Kimberley pleads that he was retained by James Richardson and Rooplal to act in the transaction and that he received instructions from both. The pleading goes on to recite that Mr. Richardson and Rooplal had told Kimberley on prior occasions that they were involved in business dealings together, leading Kimberley to believe that any sum due would be set aside through other business means.
[ 31 ] In the Sabhas' joint statement of defence they plead that Rooplal and James Richardson were involved in a transaction relating to the sale of lands in the Bahamas from Rooplal to James Richardson, in respect of which James Richardson still owed funds to Rooplal at the time of the closing of the sale of the property in Toronto. The pleading goes on to recite that Rooplal and James Richardson agreed to reduce James Richardson's debt to Rooplal on account of the Bahamas transaction in the amount of the remaining amount due for the Toronto purchase.
[ 32 ] Kimberley's file does not contain any documents from either Maureen or James Richardson or any of the Sabhas which communicate to one another or to Kimberley their intentions with respect to whether any outstanding credit would be secured on the Toronto property. The file further contains no documents reflecting whether or not the Richardsons and the Sabhas settled any outstanding credit by way of the forgiveness of a debt or otherwise.
[ 33 ] The pleadings themselves, therefore, highlight the significance of Rooplal as a participant in the transactions and events in question. It was apparent from the outset that, from the defendants' perspective, Rooplal was a key witness. He dealt with all of the other participants. His allegation that the remaining indebtedness was covered by an offset of fund due to him by Mr. Richardson, would be a complete defence to the plaintiff's claims as against himself, Riad, Nerissa and Mr. Kimberley.
[ 34 ] The extent of Rooplal's involvement is further confirmed by the affidavit of Nerissa, in which she states "many of the agreements and discussions alleged in the various pleadings, were verbal, not recorded, and witnessed by my father who can no longer give evidence to counter the plaintiff's claim."
[ 35 ] Based on the foregoing, it is self-evident that for the defendants - either Mr. Kimberley or Riad and Nerrisa – to mount a defence at trial, the testimony of Rooplal Sabha would be essential. Their ability to do so is now hopelessly compromised, by reason of his death.
[ 36 ] Had the plaintiff prosecuted this case with reasonable diligence, either from the outset or, at the very least, subsequent to the June 2008 order setting aside the administrative dismissal, it would likely have come to trial some time ago, and almost certainly prior to Rooplal's death. Efforts were plainly made on behalf of Mr. Kimberley to press the matter forward, but they were ignored by the plaintiff or her lawyer. Had Rooplal been examined for discovery prior to his death, his evidence might have been available in transcript form. No steps were taken by the plaintiff to conduct that examination.
[ 37 ] In these circumstances, I conclude that it would be unfair to require the defendants to proceed to trial. Their ability to defend the case fairly has been irreparably compromised. In my view, that prejudice far outweighs the plaintiff's right to proceed to trial.
conclusion and dispostion
[ 38 ] For these reasons I conclude that the motions of the moving parties to dismiss the action for delay as against them should succeed. I therefore order the action dismissed as against the defendants Michael Kimberley, Riad Sabha and Nerissa Sabha.
[ 39 ] In relation to costs, as the successful parties, the moving defendants are entitled to both the costs of the motion and the costs of the action. If the parties are unable to agree on the amounts to be paid, I direct the following process:
The defendants shall submit bills of costs to the plaintiff, accompanied by written submissions of no more than three pages within fifteen days.
The plaintiff shall submit her response to the defendants within fifteen days thereafter.
The defendants shall serve their reply, if any, within ten days thereafter.
In all cases, the written submissions shall be limited to three pages, plus bills of costs.
I direct that counsel for Mr. Kimberley shall collect copies of all parties' submissions and arrange to have that package delivered to me in care of Judges' Administration, Room 170 at 361 University as soon as the final exchange of materials has been completed. To be clear, no materials should be filed individually; rather counsel for Mr. Kimberley will assemble a single package for delivery as described above.
Stinson J.
Date: February 14, 2012