ONTARIO

SUPERIOR COURT OF JUSTICE

COURT FILE NO.: 02-CV-236932-CM3 and 03-CV-257029CM3
DATE: 20120514

B E T W E E N:

SANDRA SUTHERLAND

In person

Plaintiff

• and -

MANULIFE FINANCIAL also known as THE MANUFACTURERS LIFE INSURANCE COMPANY

Anna-Marie Musson , for the defendant Manulife Financial Nadine Nasr for the defendants Joyce Vincencio and Emiliano Vincencio

Defendant

AND BETWEEN:
SANDRA SUTHERLAND Plaintiff -and- JOYCE VINCENCIO, EMILIANO VINCENCIO, JAMES CAROLLO, KLLM TRANSPORT and CO-OPERATORS GENERAL INSURANCE COMPANY Defendants

HEARD: February 24, 2012

Grace J.

[ 1 ] The motions I have been asked to decide relate to actions commenced following a 2001 motor vehicle accident in which Ms Sutherland was injured. The first was commenced a decade ago against Ms Sutherland’s long term disability carrier (the “Manulife action”) and the second a few months later against those involved in the collision (the “Vicencio action”).

[ 2 ] Several prior motions have been the subject of written reasons. The long procedural history has already been told. I will refer to only a small portion of it.

[ 3 ] Briefly, the actions have been managed by Master Abrams. On July 6, 2008 she directed Ms Sutherland to fulfill certain undertakings by August 31, 2008 and to the extent those undertakings were dependent on answers from non-parties, Ms Sutherland was directed to make formal requests by that same date.

[ 4 ] The actions were not set down for trial as Master Abrams also ordered. On February 18, 2009, they were administratively dismissed for delay pursuant to rule 48.14 (4) of the Rules of Civil Procedure (“ Rules ”).

[ 5 ] On June 15, 2009, Perell J. restored the actions on terms. A new schedule was set for the completion of various steps including fulfillment of outstanding undertakings and setting the actions down for trial.

[ 6 ] Ms Sutherland filed a trial record on July 15, 2009. Its adequacy was challenged. Undertakings were said to be still outstanding. Further motions followed.

[ 7 ] On their return, Stinson J. directed a reference which Master Abrams conducted. She found that Ms Sutherland had failed to answer certain undertakings and had failed to provide records that were to be produced. Deficiencies in the trial record were identified and curative steps articulated.

[ 8 ] The Master’s report was confirmed by D.M. Brown J. on January 12, 2011.

[ 9 ] Brown J. then turned to the defendants’ request that the actions be dismissed. His concerns were summarized as follows:

Ms. Sutherland does not appear to accept the directions made by judges and masters of this court. Ms. Sutherland must appreciate that if she truly wants her day in court, she must comply with this court’s orders. Her outstanding undertakings concern important issues in respect of which the defendants are entitled to her answers before setting foot into a courtroom. [1]

[ 10 ] Nonetheless, Brown J. declined to dismiss the actions. Instead he stayed them until Ms Sutherland complied with the report and orders I have mentioned (collectively the “2008-2010 orders”). While Ms Sutherland was permitted to file a corrected trial record, she was prohibited from taking any further steps in the actions unless she had first obtained an order lifting the stay.

[ 11 ] In a subsequent costs endorsement, [2] Ms Sutherland was ordered to pay $18,000 in costs allocated among Manulife, the Vicencio and other defendants in the Vicencio action. The order was made notwithstanding her “professed impecuniosity”. Ms Sutherland was given 120 days to pay.

[ 12 ] Ms Sutherland does not ask me to grant an order lifting the stay. Manulife and the Vicencio defendants do. They then ask that I dismiss the actions on the basis that Ms Sutherland has not complied with the 2008-2010 orders and has not satisfied a portion, let alone all, of Brown J.’s costs award.

[ 13 ] The motions initially came on before me on October 25, 2011. I adjourned the motions until February 24, 2012. My endorsement noted that Ms Sutherland had not filed any responding material and that some of the undertakings had been “outstanding for an inordinate amount of time.” However, I held that the “[p]assage of time, without more, is not enough” to justify the granting of the orders sought given the fact Brown J.’s reasons contemplated the potential continuation of the stay for “several years”.

[ 14 ] The adjournment was on terms which directed Ms Sutherland to file responding materials by no later than January 16, 2012 “summarizing all of the efforts she has made to comply with the orders of and referred to by Brown J.” [Underlining in the original] The moving parties were permitted to file further material if they took the position continuation of the stay was prejudicial. A copy of the endorsement was given to those in attendance.

[ 15 ] Disappointingly, Ms Sutherland’s responding affidavit was sworn February 22, 2012. By my count, that was thirty seven days after it was to have been served and filed. The affidavit’s sixteen paragraphs make four points. First, most records have been provided. Ms Sutherland says those undelivered do “not constitute substantial materiality”. Second, she alleges the defendants undertook to contribute to the cost of obtaining certain third party records but have not done so. Third, she maintains the defendants’ actions – including these motions - are tactical. Ms Sutherland alleges they “have been using and abusing the arbitrary decisions of Master Abrams and subsequent judges as a ploy”. Fourth, Ms Sutherland intends to pay the costs ordered but “cannot conceive of any affordable means or source of funds” which allows her to do so.

[ 16 ] The affidavit does not advance Ms Sutherland’s position. As evidenced by the reasons of Master Abrams, Perell J. and Brown J., the first two points set forth in Ms Sutherland’s affidavit evidence an attempt to remake arguments about what undertakings are outstanding and about what records have been paid for and continue to be undelivered. Those were considered and nonetheless, orders were made. They were not appealed.

[ 17 ] I turn to Ms Sutherland’s third point. I will treat the suggestion of arbitrariness as an unfortunate manifestation of frustration with disappointing results. As for the suggestion the defendants have acted for tactical reasons I say this: the purpose of my October 25, 2011 endorsement was to focus the defendants on the issue of prejudice and Ms Sutherland on the task of satisfying the court that she is prepared to accept and comply with its requirements. Sadly, she appears to have ignored, rather than taken to heart, Brown J.’s earlier quoted observation.

[ 18 ] That brings me to Ms Sutherland’s fourth point: the outstanding costs order. Ms Sutherland had raised the issue of a lack of financial resources with Brown J. At para. 10 of his costs endorsement Brown J. wrote:

It is not sufficient for a litigant to file an unsworn letter with the court which simply makes the bald assertion that she lacks financial resources; more detailed evidence, given under oath, is required.

[ 19 ] Brown J.’s costs endorsement had given Ms Sutherland four months to pay instead of thirty days as rule 57.03(1)(a) contemplates. Yet, nothing was paid.

[ 20 ] By the time she attended before me on October 25, 2011, the costs order had been outstanding for eight months. I specifically encouraged Ms Sutherland to demonstrate that she had made an effort to address the issue in a meaningful way. In other words, an opportunity was given to cure – or at least minimize – the default.

[ 21 ] Four months passed between attendances before me. By February 24, 2012, the costs order had been outstanding for more than a year. Yet, nothing had changed. Ms Sutherland alleges she is unable to satisfy same. However, I know nothing about Ms Sutherland’s financial position. I do not know what income she earns, expenses she incurs or anything about her assets or liabilities.

[ 22 ] The inadequacy of Ms Sutherland’s material does not give the defendants an automatic right to the relief sought. They had asked Brown J. to dismiss the actions during argument on September 30, 2010. That request was refused.

[ 23 ] Until then, successive orders had required Ms Sutherland to complete certain steps by specified dates. Brown J. took a different tack. No time limits were imposed. That approach was a sensible one for at least two reasons: first, the history of non-compliance suggested something new was required and second, Ms Sutherland is the plaintiff. She seeks a monetary award. Ms Sutherland should be highly motivated to move these actions forward. Unless earlier resolved, she requires a favourable trial decision. However, the matters will not proceed to trial as long as they are stayed and the stays cannot be lifted until Ms Sutherland does what she is required to do.

[ 24 ] The moving parties say they are prejudiced by an indefinite stay. Manulife relies on two affidavits: the first sworn by senior claims consultant Lindsey Tomlin and the second by solicitor Amelia Leckey.

[ 25 ] Ms Tomlin deposed that business, medical and employment records are needed in order for Manulife to know and answer Ms Sutherland’s case. She expressed concern that Manulife had not been able to seek the input from its own medical expert because it lacks “a thorough understanding of…Ms Sutherland’s medical history”. Ms Tomlin also worried because she had not yet located those who had supervised Ms Sutherland when the motor vehicle accident occurred. Finally, the need for ongoing management, reporting and an ongoing monetary reserve were said to be onerous.

[ 26 ] Ms Leckey voiced similar concerns and suggested that Ms Sutherland’s continuing course of “unreasonable behaviour” was causing Manulife to incur unnecessary costs.

[ 27 ] The Vicencio’s rely on the affidavit of their solicitor Ian Gold. That affidavit reiterates those I have already summarized.

[ 28 ] The issue of prejudice to the defendants was something Brown J. contemplated being considered if and when Ms Sutherland moved to lift the stay. Brown J. wrote:

I impose such a requirement in order to afford the defendants an opportunity to make any argument about prejudice they might suffer should the court lift the stay. If Ms. Sutherland complies with the orders in the next few months, I would think any prejudice to the defendants in lifting the stay would be minimal. But were Ms Sutherland to take several years to comply with the orders, it is possible real prejudice might exist at that point in time. [3]

[ 29 ] With respect, save for one item, everything raised in the Tomlin, Leckey and Gold affidavits relates to the same consequences flowing – or said to be flowing – from circumstances existing when Brown J.’s reasons were released.

[ 30 ] I have read nothing which suggests that the ability of Manulife and/or the Vicencio defendants to prepare for and participate in a trial would be prejudiced if Ms Sutherland does what she has been ordered to do. I am underwhelmed by Ms Tomlin’s suggestion two potential witnesses have not yet been located despite her “own preliminary internet inquiries”. Similarly, the maintenance of a “monetary reserve” of unstated amount and cost is of minimal impact. To this point the motions strike me as a repackaging of arguments made to and rejected by Brown J. [4]

[ 31 ] Of greater concern is the outstanding costs order. Rules 57.03(2) and 60.12 give the court broad powers where a party fails to comply with an interlocutory order. Given the fact the proceedings have already been stayed, the most significant is the power to dismiss the defaulting party’s proceeding. [5]

[ 32 ] That consequence was visited on a defendant in Tarion Warranty Corporation v. 1486448 Ontario Inc . (“ Tarion Warranty ”). [6] Two costs orders totaling $3,900 were made in October 2010 and April, 2011 and not satisfied. On July 28, 2011, the defaulting party’s statement of defence was struck.

[ 33 ] Striking a defence – or dismissing an action – on the basis of a failure to pay an outstanding costs order is a significant and irreparable step. It should not be undertaken lightly. [7]

[ 34 ] In allowing the appeal in Tarion Warranty , the Court of Appeal wrote:

…while standing alone, lack of funds cannot justify a failure to pay costs, evidence of impecuniosity is a factor to take into consideration. As is always the case where there are competing interests, the goal is to strike a balance. Here, the competing interests are allowing an impecunious litigant the opportunity to have his or her potentially meritorious claim adjudicated upon, and enforcing court orders…

Exposing the appellant to a judgment of over $180,000 when there is no suggestion that his defence is without merit, in circumstances where the self-represented appellant had unchallenged evidence before the motion judge that he was impecunious, was a disproportionate response to his failure to pay a relatively small amount of costs that had been outstanding for a relatively small amount of time. [8]

[ 35 ] Ms Sutherland deposed:

That I do intend to pay the $18,000.00 costs as sanctioned against me, however; at the moment. (sic) I cannot conceive of any affordable means or source of funds that would permit me to acquire and/or afford the $18,000.00 funds. Therefore it (sic) my inability to pay that hinders me from doing so and payment is not being withheld for any malicious or negligent reasons. [9]

[ 36 ] Given the history of this matter, the passage of time since the outstanding costs order was made, the failure to make any payment on account despite my October 25, 2011 endorsement and the absence of evidence of impecuniosity, I am very tempted to accept the defendants’ submission in favour of an order dismissing the actions.

[ 37 ] However, I am conscious of the fact Ms Sutherland is self-represented, that the actions follow a motor vehicle accident in which she was injured, that while her efforts to comply with previous orders have been the subject of adverse comment, there is evidence of compliance with other aspects of them. Importantly, having seen and heard Ms Sutherland on two occasions, I am inclined to accept that she should be given a final opportunity to cure her default. Dismissing the actions now would, in my opinion, be “disproportionate”.

[ 38 ] Rules 57.03 (2) and 60.12 (c) also allow the court to “make such other order as is just.” I am of the view a just order is this: Ms Sutherland shall pay the outstanding costs order, including all accrued interest, on or before October 31, 2012 failing which the stay imposed by Brown J. shall, without more, be lifted and these actions dismissed with costs.

[ 39 ] If the outstanding costs order is fully satisfied on a timely basis, the stay imposed by Brown J. shall remain in full force and effect on the terms he has already established.

[ 40 ] If costs of these motions are sought, short written submissions not exceeding three typed pages may be provided to me through Judges’ Administration, Court House, 12 th Floor, Unit “K”, 80 Dundas Street, London, Ontario N6A 6B2 may be provided to me. Those of the defendants Manulife and Vincenzio shall be delivered by 430 p.m. on May 29 and those of Ms Sutherland by 430 p.m. on June 12, 2012.

“ Duncan Grace .”

Grace J.

Released: May 14, 2012

COURT FILE NO.: 02-CV-236932-CM3 and 03-CV-257029CM3
DATE: 20120514

ONTARIO SUPERIOR COURT OF JUSTICE B E T W E E N: SANDRA SUTHERLAND Plaintiff - and – MANULIFE FINANCIAL also known as THE MANUFACTURERS LIFE INSURANCE COMPANY Defendant AND BETWEEN: SANDRA SUTHERLAND Plaintiff - and – JOYCE VINCENCIO, EMILIANO VINCENCIO, JAMES CAROLLO, KLLM TRANSPORT and CO-OPERATORS GENERAL INSURANCE COMPANY Defendants REASONS FOR JUDGMENT Grace J.

Released: May 14, 2012

[1] 2011 ONSC 217 (S.C.J.) at para. 18 .

[2] 2011 ONSC 1170 (S.C.J.)

[3] Supra, note1 . at para. 19 (iii).

[4] For a discussion of non-compensable prejudice see: Oberding v. Sun Life Financial Assurance Co. of Canada , 2010 ONSC 3303 , [2010] O.J. No. 3122 (Div. Ct.); Savundranagyagam v. Sun Life Assurance Company of Canada , 2008 54788 (ON SCDC) , [2008] O.J. No. 4215 (Div. Ct.)

[5] Rule 60.12 (b).

[6] The decision was addressed by the Court of Appeal at 2012 ONCA 288 .

[7] Bell ExpressVu Limited Partnership v. Corkery , 2009 ONCA 85 at paras. 34-37 .

[8] Tarion Warranty Corporation v. 1486448 Ontario Inc ., supra note 6 at paras. 6-7.

[9] See para. 14 of Ms Sutherland’s February 22, 2012 affidavit.