COURT FILE NOS.: CV-10-0138-00 ; CV-11964-00; FS-09-0953-00

DATE: 20100430

SUPERIOR COURT OF JUSTICE – ONTARIO

RE: Nashaat Aly et al v. Nader Halal Meat Inc. et al (CV-10-0138-00)

AND:

Naima Mohamed El-Sayed Mohamed El Feky v. Nader Halal Meat Inc. et. al. (CV-11964-00)

AND:

Naima Mohamed El-Sayed Mohamed El Feky v. Adel Mohamed Tohamy (FS-09-0953-00)

BEFORE: Ricchetti J.

COUNSEL:

Counsel for Nashaat Aly and Taghreed Aly, CV-10-0138-00, R. Fisher

Counsel for the Adel Mohamed Tohamy, FS-09-0953-00, A. Farooq

HEARD: April 25, 2012

ENDORSEMENT

[ 1 ] The trial in this matter is scheduled to commence on May 14, 2012.

[ 2 ] Several pre-trial motions in the Hashaat Aly et al v. Nader Halal Meat Inc. et al (Aly Action) were heard this day.

Productions

[ 3 ] On consent, the following order is made:

a) The plaintiffs in the Aly Action shall, within 2 days, produce a copy of the trading account summary showing the source of the Plaintiffs’ income in the amended 2005 returned (filed in 2008) of approximately $4.7 Million.

b) The plaintiffs in the Aly Action confirm the following facts in response to the undertakings:

i. The 2008 amended tax return was for the calendar years 2005- 2006-2007.

ii. No other amended tax returns have been filed by the plaintiffs.

iii. Other than Mr. Nashaat Aly’s handwritten notes (which are no longer in existence), there are no other source documents for the 2008 amended tax return.

c) The costs of this motion will be dealt with at the conclusion of the trial.

Exclude Certain evidence

[ 4 ] The Defendants have brought a motion to exclude the evidence of:

i. The discussions and communications regarding two meetings which took place on March 2, 2008 and March 4, 2008 including any subsequent actions taken in preparation and in furtherance of what was discussed at the March 2, and 4, 2008 meetings; and

ii. Discussions and communications between Adel Tohamy and Sarwat Salem in June or July 2008.

Meetings on March 2 and 4, 2008 and related communications and actions

[ 5 ] The meetings on March 2 and March 4, 2008 were attended by Mr. Dean El-Sedfy and Mr. Zaher Masood.

[ 6 ] Mr. Adel Tohamy was not at the March 2, 2008 meeting but was at the March 4, 2008 meeting along with Mr. El-Sedfy and Mr. Masood.

[ 7 ] Mr. Nashaat Aly was at the March 2 and 4, 2008 meetings.

[ 8 ] The proposed evidence of Mr. El-Sedy and Mr. Masood are set out in their affidavits dated October 28, 2008 and October 18, 2008 respectively. They are similar and set out the following:

• They know the parties to this litigation.

• They were aware of the dispute between the parties to this litigation regarding the ownership of the business.

• Both parties to this litigation asked them and they agreed they would mediate the dispute.

• They held meetings with the parties and others to assess the dispute.

• On March 2, 2008, they met with Mr. N. Aly to discuss the issues in the dispute claim and they appeared to have come to some determination on the dispute.

• On March 4, 2008, a second meeting was held where both Mr. N. Aly and Mr. A. Tohamy were present, along with other persons.

• “The purpose of the meeting was to attempt to reach a reasonable settlement between the two parties.” (para. 9 of Mr. El-Sedy’s affidavit)

• Settlement discussions regarding the dispute ensued.

• Mr. El-Sedy thought they had resolved the dispute (para.13).

[ 9 ] The Alys propose to call Mr. El-Sedfy and Mr. Masood to give the evidence of what was discussed at the two meetings.

[ 10 ] There are several additional relevant facts:

a) Mr. N. Aly had already sought legal advice. The fact there was a dispute to be resolved, failing which litigation was likely, is incontrovertible. In other words, litigation was contemplated if the dispute could not be resolved;

b) Mr. N. Aly states in his responding affidavit that the Muslim community encourages settlement through meeting with community leaders; and

c) Several cheques were delivered subsequently, either in furtherance of a perceived settlement or to further the settlement discussions. As stated by Mr. El-Sedfy, the parties were looking at a further investment as a settlement of this dispute. This is consistent with Mr. A. Tohamy’s description of why the cheques were delivered – a settlement with his brother by finding another investment. Clearly, the deliverance of the cheques is related to the results of the “mediations” on March 2 and 4, 2008.

[ 11 ] On its face, this evidence is privileged as:

a) It was done in contemplation of litigation;

b) The communications were understood not to be disclosed. This is expressly stated by Mr. A. Tohamy in his examination for discovery. In any event, this can clearly and unquestionably be inferred from the circumstances, the purpose and what transpired at the meetings in question and subsequent to the meetings; and

c) The purpose of the meetings was a bona fide attempt by Mr. N. Aly and Mr. A. Tohamy to effect a settlement of the dispute which now forms the claim before this court.

[ 12 ] Let me deal with the respondent’s submissions.

[ 13 ] The plaintiffs submit that Mr. A. Tohamy was not at the meeting on March 2, 2008. I reject this submission as it is clear that the witnesses were “asked” by both parties and “agreed” to “mediate”. What transpired on March 2, 2008 was still part of the mediation regardless of whether one party was not present. To impose a requirement that both parties must be at the meeting would significantly, negatively impact the ability of mediators to conduct one-on-one meetings where full, frank discussions and compromises are encouraged including statements which might be made or positions taken which would otherwise be prejudicial to the party at trial.

[ 14 ] The plaintiff states the evidence should go in on the basis of credibility. I reject this submission. The entire purpose of settlement privilege is to allow persons to make statements or take positions which might be contrary to their position at trial – for any number of reasons – and, provided it was a bona fide attempt to resolve the dispute, to do so without fear that the statements or positions taken will subsequently be used against them in court. This protects both parties the party who might directly or indirectly admit liability and the other party who may be prepared to accept less than they seek at trial. The trial judge is the gatekeeper of admissible evidence. It would be an abdication of this responsibility to permit evidence, which is clearly inadmissible on the basis of settlement privilege, to go in for the purpose of assessing credibility. It would completely undermine the policy of settlement privilege that the statements cannot go in for proof of what was said but could be used to assess credibility.

[ 15 ] The last ground in which the plaintiff seeks the admissibility of this evidence is on the basis that Mr. A. Tohamy did not consider this to be a mediation or settlement discussion to resolve the dispute. If correct, this is a critical issue. It is in my view it is of critical importance to settlement privilege that both parties intend to engage in bona fide settlement discussion. In other words, there must be a common intention to engage in bona fide settlement discussions.

[ 16 ] The plaintiffs rely on the examination for discovery of Mr. A. Tohamy on May 27, 2009.

[ 17 ] Let me provide several excerpts:

Q. So, this was to discuss the claims of Nashaat and Taghreed Aly relative to the store, isn’t that right?

A. No, ma’am.

Q. No?

A. No. He had no claim ever. That was my position, because he never was a partner. It was going there to see how can I help them. What is the best way and best for to help them.

The Deponent: Please. The meeting was done so I can help him, and again, to help him, I know he wouldn’t accept charity from nobody. So, I told the two people, before we go there, we sit down in Tim Horton and I said, “Hey guys, if he say, ‘I am partner”, or so on, nobody object.” They said, “What? What about the facts, what about the truth?” I said, “Please, if he say, we are not acknowledging it, but don’t object to it. Then we see how much I can give him so he can start another life.” “Is that the way you want it?” I said, “yes”. And that people will testify that that happened outside before the meeting. Because all this meeting was supposed to be out – out of prejudice, what you call it? Because it was a meeting to solve something. So, you cannot use that meeting in something like that. It’s without prejudice the whole meeting, and what happened inside, and my tactic and I offer, and, and, and, ...

[ 18 ] This evidence does not support the plaintiff’s position. It is evidence that Mr. A. Tohamy attended the meeting with the proposed witnesses to settle this dispute now before this court.

[ 19 ] The plaintiffs also assert that the defendants waived privilege by including the affidavits of Mr. El-Sedfy and Mr. Masood when the motion was brought to set aside the CPL. It is important to note that these two affidavits were included in and attached to Mr. N. Aly’s affidavit as Exhibits. It was Mr. Aly’s affidavit that was put before the court by the defendants to set aside the CPL. This is not a waiver of the settlement privilege. There is no evidence that Mr. Tohamy intended to waive privilege with respect to what was discussed at the meeting. It was filed because it was necessary that Mr. Aly’s affidavit be before the court on the motion to set aside the CPL motion. It would have been impossible to proceed without Mr. Aly’s affidavit, in full, being before the court on the motion. There is no evidence on this motion of any other use of the Mr. El-Sedfy’s and Mr. Masood’s affidavits by the defendants.

[ 20 ] I conclude that the parties clearly engaged in mediation through the two proposed witnesses and were engaged in bona fide settlement discussions which were, either expressly or impliedly, intended to be confidential and without prejudice.

[ 21 ] As I stated above, the cheques which passed between the parties were done in furtherance of a perceived settlement or possible settlement and, as a result these are also subject to the same privilege.

[ 22 ] It is not necessary to determine on which party the onus rests on this motion. Regardless of which party has the onus, the evidence is clear, what was discussed on March 2 and March 4, 2008 was part of a mediation process and, therefore, is privileged.

[ 23 ] This evidence will be excluded.

Meeting with Sarwat Salem in June/July 2008

[ 24 ] The plaintiffs submit that further settlement discussions took place at the behest of the defendants in late June or July 2008 when Mr. Sarwat Salem came to Mr. A. Tohamy’s home.

[ 25 ] Mr. Tohamy doesn’t provide any further evidence regarding what, if any, settlement discussions or proposals were discussed. All he says is that Mr. Salem tried to convince him to agree to a friendly settlement.

[ 26 ] Counsel for Mr. Tohamy admits there is no evidence before this court that the plaintiff’s knew and intended that Mr. Salem engage Mr. Tohamy in settlement discussions on their behalf.

[ 27 ] The significance of the anticipated evidence of Mr. Salem was that at this meeting in June/July 2008 Mr. Tohamy allegedly told him that he would destroy the cash register and hard drive which had financial information regarding the business at issue.

[ 28 ] The difficulty with Mr. Tohamy’s position is the following:

i. There is no evidence that there was a common intention between the plaintiffs and defendants that these were settlement discussions. Whether Mr. Salem undertook these discussions on his own or whether Mr. Tohamy believed them to be settlement discussions is not sufficient;

ii. There is no evidence of any actual settlement discussions taking place; and

iii. The discussions surrounding the alleged destruction of the financial information cannot possibly be settlement discussions and certainly not bona fide settlement discussions.

[ 29 ] The evidence of Mr. Salem is admissible.

Skype Evidence

[ 30 ] The plaintiff proposes to call Mr. Masood and Mr. Salem as witnesses at the trial in this matter by way of a live, video link through Skype.

[ 31 ] Mr. Masood is an engineer and presently is working in China. The plaintiffs cite cost ($2-6,000) and time to travel to Canada (approximately 27 hours) for his evidence as the basis for a “Skype” order. There is some vague reference to “health” but no details on this.

[ 32 ] Mr. Salem is working in Egypt. The plaintiffs cite travel time (16-25 hours) and the cost ($1,500 - $2,400) as the basis for a “Skype” order. There is some vague reference to “health” but no details on this.

[ 33 ] The defendants oppose the granting of such an order. The defendants concerns include the following:

i. This is to permit the witnesses to avoid in-court testimony in a foreign location where they will feel more at ease;

ii. The defendants believe that the witnesses have previously given and will again give false testimony;

iii. The health issues are undocumented;

iv. Mr. Masood resides and returns to Canada from time to time and has been here for other matters such as affidavits;

v. The Skype site is unreliable.

The Law

[ 34 ] I accept the review and comments of Justice Murray in Paiva v. Corpening , [2012] O.J. No. 771 (Ont. C. J.) at paragraphs 23 – 37 :

Evidence should be presented orally in open court

23 It is a general principle in both civil and criminal cases that, if there is a trial, that evidence at trial should be presented orally in open court. That principle is reflected in Rule 1.08 (5) (a), and in the criminal cases cited by the Respondent. It is important to note, however, that it is not every case in which a litigant is entitled to a trial with viva voce evidence.

24 This case is a motion to change a final order, not an application of first instance. Pursuant to Rule 15 of the Family Law Rules, such a motion is to be determined based on affidavit evidence and not a viva voce hearing, unless the court is of the opinion that another process is required to dispose of the matter justly. I have already decided that in this case evidence in chief will be introduced by affidavit, and that viva voce cross-examination will be permitted. The manner in which that cross-examination will be conducted is within the court's discretion.

Importance of the evidence

25 The Applicant does not argue that her evidence is unimportant. She will testify as to her experiences with the Respondent and the reasons why she believes that access is not in the children's best interests, as well as to the children's current circumstances. The presiding judge will be called upon to assess the credibility of the Applicant as well as of the Respondent.

Effect of video-conferencing on court's ability to make findings and determine credibility

26 In my view, if the technology that facilitates the video conference operates effectively, then the court will be able to observe the Applicant and make judgments about her credibility.

27 Other courts have found that is possible to make findings of fact and decisions about credibility based on video conference evidence. In Wright v. Wasilewski , 2001 28026 (ON SC) , [2001] O.J. No. 248 , a personal injury case, Master Albert observed that while attendance of a witness in person is always preferable, that:

"Video conferencing is an interactive technology. It is conducted in real time. The [witness] ... [is] able to see and hear what is going on in the courtroom. Those in the courtroom in Toronto are able to see and hear the witness 'live'. Questions can be asked and answered. Examinations in chief, cross-examinations and redirect examination could be conducted live, though not in person.

"... evidence presented by videoconferencing ... gives the [trier of fact] an opportunity to observe the demeanour of the witness and hear the inflections of voice and other visual and verbal cues that are part of oral testimony," and that

videoconferencing evidence can "provide the evidence necessary for the judge and jury to reach a just determination of the claim on its merits" and is "a reasonable and appropriate alternative".

28 Master Albert permitted 20 witnesses, including medical experts, to give evidence by way of video-conference. The Applicant cites similar decisions in several civil cases, including family proceedings, in which courts have permitted such evidence from witnesses, including parties 1 .

29 The Respondent's counsel relies upon a number of criminal cases 2 in which the court did not permit evidence to be given by video conference. Under section 714.1 of the Criminal Code , a court has discretion to allow such evidence if it is appropriate in all the circumstances, including:

the location and personal circumstances of the witness;

the costs that would be incurred if the witness had to be physically present; and

the nature of the witnesses anticipated evidence.

30 Courts in those cases were concerned that taking evidence by video link would impede the effectiveness of defence counsel's cross-examination and thus "compromise the accused's right to make full answer and defence". Many of these cases involved motions by the Crown to allow video conference evidence because of the cost of transporting the witness to the place of trial.

31 It is worth noting that there are other criminal cases 3 decided under section 714.1 in which video conference evidence was permitted because of a complainant's personal circumstances, including the cost of travelling to trial. These were cases of domestic assault and sexual assault in which assessment of the credibility of the complainant was crucial; judges in those cases found that they were not hampered in any substantial way in making credibility assessments.

32 If video conference evidence is permitted, it is important that the party who is presenting such evidence liaise with court administration in advance of the hearing to insure that the proposed video link is workable and effective.

Reason witness is unable to attend

33 The Applicant deposes that she and her spouse are unable to attend the hearing because they cannot financially afford the trip, and secondarily because one of them must stay in Denmark to care for the children. The Respondent, in opposing the motion, refers to criminal cases in which courts have found that the cost to the Crown of transporting an important witness to trial is not, in and of itself, a sufficient reason to permit video-conference evidence.

34 The Applicant did not address whether she has the ability to borrow further to finance a trip to Toronto to attend the hearing. I will assume for the purpose of this motion that she is able to incur further debt.

35 Having said that, I observe that the Applicant and her spouse are already heavily in debt and are solely responsible for the support of Jaidyn and Mackenzie as well as Olivia. If I require them to travel to Toronto to be cross-examined, that decision will place further financial pressure on their household by requiring that they borrow $2,000 to finance the trip. This decision will affect the household in which the children reside.

Balance of convenience

36 It is clear to me that the balance of convenience on this motion favours the Applicant. With the conditions which I set out below, the Respondent should suffer little or no prejudice in his counsel's ability to cross-examine. The cross-examination will be conducted in real time, and the "lag" which counsel fears in the transmission of questions and answers should not exist. Requiring the Applicant and her spouse to travel to Toronto would have a negative impact on their already financially-stretched household, and would be damaging to the children's best interests.

37 Cross-examination of the Applicant and Mr. McLellan by Skype will be permitted. The Applicant shall bear any of the costs incidental to facilitating this video conference. Applicant's counsel shall contact court administration well in advance of the trial to insure that the connection between the facilities to be used in Denmark and Courtroom 1E in Toronto is effective.

[ 35 ] Very simply, many of the concerns raised by the defendants are not real when considering live video conferencing where the court can see the witness live and the witness can see counsel and the court live.

[ 36 ] The main submission of the defendants is that this court will be unable to assess the demeanour of the witnesses. Firstly, I disagree. The link is live. The witness can be seen as though the witness was here. An assessment of the witness’ demeanor can be made.

[ 37 ] The approach on such motions is to balance the competing interests.

[ 38 ] On one hand a party’s qualified right to have a live witness to cross-examine and the potential prejudice that might arise if the witness were not present in the courtroom.

[ 39 ] On the other hand, balancing the importance of the evidence, the convenience, the cost of attendance and other relevant factors such as the importance of the evidence, the amount at issue and so on.

[ 40 ] Obviously, the more important the evidence to the central issues the court has to decide, the more likely prejudice may be occasioned by the fact the witness is not in court. This is one factor which would favour not granting a Skype order.

[ 41 ] On the other hand, where the evidence is on some peripheral matter or the cost and inconvenience is very high, these are factors which would weigh in favour of granting a Skype order.

Mr. Masood

[ 42 ] Given the decision above regarding Mr. Masood’s evidence from the meetings on March 2 and 4, 2008, his evidence will be brief. It is not central to the issues to be tried as he was not present during the early years when the alleged agreement was entered into. Mr. Masood’s evidence is not of such importance that any prejudice will be suffered to the defendants if his evidence is given by live, through a Skype link.

[ 43 ] The evidence of Mr. Masood will be permitted by Skype at trial on the following terms:

i. It will be the responsibility of the plaintiffs to ensure the link is workable and reliable throughout the entirety of the evidence. Should the number, type and length of disruptions (due to equipment or the time difference) be such that the witnesses’ evidence (in-chief, cross and re-exam) cannot be fully appreciated, it will be a factor in determining the weight, if any, to be given to the witnesses’ evidence. The plaintiffs will have to consider this in deciding whether to introduce evidence using Skype;

ii. The plaintiffs shall make arrangements and pay for any costs associated with arranging the facilities and equipment that will be necessary in the courtroom and in China; and

iii. The Plaintiffs will also be responsible to ensure a copy of all documents that will or potentially will be put to the witness are available to the witness at the location prior to the commencement of the evidence. Counsel should cooperate to ensure that all the necessary documents have been identified.

Mr. Salem

[ 44 ] In the plaintiff’s Amended, Amended, Amended, Amended Statement of Claim, the plaintiffs advance a claim of spoliation and seek damages in the amount of $3,500,000.

[ 45 ] Mr. Salem’s evidence on this issue may be prominent or central to a determination on the issue of spoliation. On the evidence before me at this time, Mr. Salem’s evidence is the only evidence that the defendants deliberately destroyed the financial records of the business to avoid or assist in avoiding this claim. Given the central importance of this evidence and the nature of the evidence, this favours the evidence being viva voce .

[ 46 ] On the other hand, the cost of the flight is not that significant by comparison to the amounts at issue in this claim. There are no other issues alleged which would prevent Mr. Salem from attending trial,

[ 47 ] Weighing the competing interests, I am satisfied that Mr. Salem’s evidence should be given viva voce at trial.

[ 48 ] Mr. Salem’s evidence at trial will not be permitted by Skype.

Costs

[ 49 ] Both parties have provided me with their Costs Outline.

[ 50 ] Either party which seeks costs of these motions may make written submissions limited to three pages which submissions must be served and filed within two weeks of today’s date.

[ 51 ] The responding party may make responding submissions within one week thereafter, also limited to three pages.

Ricchetti, J.

Date: April 30, 2012