SUPERIOR COURT OF JUSTICE - ONTARIO

COURT FILE NO.: 10-CV-406099
MOTION HEARD: May 15, 2012

RE: Jugal Taheem v. Shannon Palmer and Pamela Palmer

BEFORE: MASTER R.A. MUIR

COUNSEL: William G. Scott, counsel to the lawyer for the plaintiff
James S. Schacter for defendants

REASONS FOR DECISION

[ 1 ] The plaintiff brings this motion pursuant to Rule 37.14 of the Rules of Civil Procedure , R.R.O. 1990, Reg. 194 (the “Rules”) for an order setting aside the order of the registrar dated April 12, 2011 dismissing this action as abandoned. This action was dismissed by the registrar pursuant to Rule 48.15 as more than 180 days had passed since the statement of claim was issued and no defence had been filed.

[ 2 ] The plaintiff also seeks an order extending the time for service of the statement of claim and validating service of the statement of claim on the defendants.

[ 3 ] The defendants oppose the relief sought by the plaintiff on this motion.

BACKGROUND FACTS AND HISTORY OF THE ACTION

[ 4 ] This action arises from a motor vehicle accident that took place on November 10, 2008 at the intersection of Regional Road 50 and McEwan Drive in the town of Caledon. It appears that a vehicle being driven by the defendant Shannon Palmer (“Shannon”) collided with the plaintiff’s vehicle while attempting to make a left hand turn onto McEwan Drive. The police report from the accident indicates that Shannon was charged with making an improper left hand turn under the provisions of the Highway Traffic Act , R.S.O. 1990, c. H.8 (the “HTA”).

[ 5 ] Shannon reported the collision to her insurer, The Economical Mutual Insurance Company (“Economical”) shortly after the accident. The vehicle she was driving, which was owned by her mother, the defendant Pamela Palmer (“Pamela”) suffered significant damage and was considered a total loss.

[ 6 ] It appears that in early 2009 there was some communication between Economical and the plaintiff’s insurer. Economical was apparently advised that the plaintiff had made a property damage claim only and that no accident benefits claim had been made. Economical then closed its file. There was no further communication with Economical until May, 2011, after this action had been dismissed.

[ 7 ] The statement of claim in this action was issued on July 5, 2010. The motor vehicle accident report made at the time of the accident had listed Shannon’s address as “64 Lauren Harris Crescent, Bolton, Ontario”. On June 24, 2010, the plaintiff’s lawyer had obtained a driver record search from the Ministry of Transportation (“MTO”) which showed Shannon’s address as “64 Lawren (being the correct spelling of Lawren) Harris Crescent, Bolton, Ontario”. On the same day, the plaintiff’s lawyer also conducted a plate search with MTO, which indicated that there was no record of the plate number for Pamela’s vehicle, as set out in the accident report.

[ 8 ] For some reason, however, the address of the defendants set out in the statement of claim was incorrectly noted as 62 Lawren Harris Crescent, Bolton, Ontario.

[ 9 ] On July 26, 2010, a process server was sent to Lawren Harris Crescent to attempt to serve the statement of claim. He attempted to do so at 62 Lawren Harris Crescent, the address recorded on the statement of claim. He was apparently told by an unidentified male that Pamela had moved. The process server’s affidavit of attempted service makes no reference to him being told that Shannon had moved.

[ 10 ] The plaintiff’s lawyer conducted a further driver record search on September 23, 2010 which indicated that Shannon was still living at 64 Lawren Harris Crescent, Bolton. Further attempts were made to serve Shannon and Pamela at 62 Lawren Harris Crescent on September 14, 2010, October 7, 2010 and October 20, 2010. On each of those occasions the process server received no response at the door.

[ 11 ] Of course, it is apparent that the process server was attempting to serve the defendants at the wrong address. It appears that no one had noticed the inconsistencies between the actual address, as shown on the searches and the accident report, and the mistaken address listed on the statement of claim and the affidavits of attempted service.

[ 12 ] On February 4, 2011, the plaintiff’s lawyer caused a further driver record search to be conducted by Legal Link. Once again, this search revealed that Shannon’s address was 64 Lawren Harris Crescent, Bolton. It appears that this time the plaintiff’s lawyer noticed the discrepancy and a different process server was dispatched to attempt service at the 64 Lawren Harris Crescent address. According to affidavits of service sworn September 8, 2011, the defendants were served with the statement of claim in this action on February 23, 2011 by leaving a copy of the statement of claim with a “Mr. Palmer” who appeared to be an adult member of the same household at 64 Lawren Harris Crescent.

[ 13 ] In fact, the defendants had moved from 64 Lawren Harris Crescent in September, 2009. Since that time they have been living in Mississauga. Moreover, the defendants state that at no time when they were living at 64 Lawren Harris Crescent did they live with anyone known as “Mr. Palmer”.

[ 14 ] Prior to this alleged service of the statement of claim, the court had issued a notice that this action would be dismissed pursuant to Rule 48.15. The notice was received by the plaintiff’s lawyer on January 7, 2011. The plaintiff’s lawyer took no action in response to this notice. His evidence is that it is his office’s usual practice to bring such notices to the attention of the responsible lawyer and to take the necessary steps to respond in the appropriate fashion. The plaintiff’s lawyer states that he has no recollection of this particular notice being brought to his attention and he concludes that it must have been misfiled.

[ 15 ] On April 12, 2011, the registrar dismissed this action as abandoned.

[ 16 ] It appears that on May 11, 2011, the plaintiff’s lawyer faxed copies of the statement of claim and affidavits of service to Economical. No covering letter accompanied the fax. The plaintiff’s lawyer did not advise Economical that the action had already been dismissed. The affidavits of service faxed to Economical were sworn March 1, 2011 and indicated that the defendants were served on February 27, 2011 and not February 23, 2011 as is indicated in the affidavits of service included with the plaintiff’s motion record (which I note were sworn on the same day as the supporting affidavit for this motion). The March affidavits also indicate that the defendants were served at 62 Lawren Harris Crescent whereas the September affidavits refer to service at 64 Lawren Harris Crescent. No explanation has been provided for these discrepancies.

[ 17 ] It appears that the plaintiff and his lawyer took no further steps to advance this action until a motion record was prepared on September 8, 2011, seeking an order setting aside the dismissal. Amazingly, the affidavit of service that was filed with the motion record shows that the plaintiff purported to serve the motion record by mailing a copy to the defendants at 62 Lawren Harris Crescent, Bolton. Moreover, the motion record was mailed to the defendants six business days before the hearing date. Even if it had been mailed to the correct address, this was clearly insufficient notice under the Rules .

[ 18 ] It appears that the plaintiff also provided a “courtesy copy” of the motion record to Economical who then retained Mr. Schacter. On September 16, 2011, Master Brott made an order adjourning the motion on consent to November 23, 2011. In her endorsement she indicated that the motion record must be served on the defendants. The motion was then assigned to me to be heard as a long motion. In a conference call on December 8, 2011, the parties agreed to have this motion heard on May 15, 2012.

ANALYSIS

REGISTRAR’S DISMISSALS

[ 19 ] In the last five years, the law relating to setting aside registrar’s dismissal orders has been the subject of seven decisions of the Court of Appeal for Ontario. [^1] Although each of those decisions brings a slightly different approach to the decision making process, the general approach first set out by the Court of Appeal in Scaini has been followed consistently. The principles that emerge from those decisions can be summarized as follows:

● the court must consider and weigh all relevant factors, including the four Reid [^2] factors which are likely to be of central importance in most cases; [^3]

● the Reid factors, as cited by the Court of Appeal in Giant Tiger , are as follows:

(1) Explanation of the Litigation Delay : The plaintiff must adequately explain the delay in the progress of the litigation from the institution of the action until the deadline for setting the action down for trial as set out in the status notice. She must satisfy the court that steps were being taken to advance the litigation toward trial, or if such steps were not taken to explain why.... If either the solicitor or the client made a deliberate decision not to advance the litigation toward trial then the motion to set aside the dismissal will fail.

(2) Inadvertence in Missing the Deadline : The plaintiff or her solicitor must lead satisfactory evidence to explain that they always intended to set the action down within the time limit set out in the status notice, or request a status hearing, but failed to do so through inadvertence. In other words the penultimate dismissal order was made as a result of inadvertence.

(3) The Motion is Brought Promptly : The plaintiff must demonstrate that she moved forthwith to set aside the dismissal order as soon as the order came to her attention.

(4) No Prejudice to the Defendant : The plaintiff must convince the court that the defendants have not demonstrated any significant prejudice in presenting their case at trial as a result of the plaintiff's delay or as a result of steps taken following the dismissal of the action; [^4]

● a plaintiff need not satisfy all four of the Reid factors but rather a contextual approach is required; [^5]

● the key point is that the court is to consider and weigh all relevant factors to determine the order that is just in the circumstances of each particular case; [^6]

● all factors are important but prejudice is the key consideration; [^7]

● prejudice to a defendant may be presumed, particularly if a lengthy period of time has passed since the order was made or a limitation period has expired, in which case the plaintiff must lead evidence to rebut the presumption; [^8]

● once a plaintiff has rebutted the presumption of prejudice, the onus shifts to the defendant to establish actual prejudice; [^9]

● prejudice to a defendant is not prejudice inherent in facing an action in the first place but prejudice in reviving the action after it has been dismissed as a result of the plaintiff’s delay or as a result of steps taken following the dismissal of the action; [^10]

● the party who commences the litigation bears the primary responsibility under the Rules for the progress of the action; [^11]

● in weighing the relevant factors, the court should not ordinarily engage in speculation concerning the rights of action a plaintiff may have against his or her lawyer but it may be a factor in certain circumstances, particularly where a lawyer’s conduct has been deliberate. The primary focus should be on the rights of the litigants and not with the conduct of their counsel. [^12]

[ 20 ] There would appear to be no difference in the test to be applied where an action has been dismissed by the registrar as abandoned as opposed to a dismissal of an action for delay. [^13]

EXTENDING TIME FOR SERVICE

[ 21 ] The law relating to extending time for service is well settled. The analysis must focus on prejudice to the defendants. The prejudice that will defeat an extension of time must be caused by the delay. Each case must be decided on its particular facts. [^14]

[ 22 ] These are the principles I have considered and applied in determining the issues on this motion.

MOTION BROUGHT PROMPTLY

[ 23 ] I am not satisfied, in the circumstances of this action, that the plaintiff has brought this motion within an acceptable time period after becoming aware of the dismissal order. The relevant authorities and Rule 37.14(1) require that motions of this nature be brought forthwith after the order comes to the attention of a plaintiff or his or her lawyer. The evidence shows that the plaintiff and his lawyer did nothing to address the dismissal order for a period of almost five months. They did not seek to obtain the consent of the defendants or Economical to an order setting aside the dismissal. There is no evidence of any attempt to book an early date with the motions scheduling office. When the motion was brought, it had to be adjourned and delayed even further because of improper service. In my view, this lapse of time cannot be described as prompt in the circumstances of this motion.

[ 24 ] In my view, the plaintiff has not satisfied this element of the Reid test.

INADVERTENCE

[ 25 ] I am satisfied that the plaintiff has established that his failure to comply with Rule 48.15 was a result of inadvertence. The uncontradicted evidence of the plaintiff’s lawyer is that his firm’s usual practice is to bring dismissal notices to the attention of the lawyer handling a particular matter. Of course, a lawyer is presumed to be aware of the provisions of the Rules and it should not be up to the court to send out regular reminders. However, Rule 48.15(1) does require the registrar to give such a notice before dismissing an action. In my view, it is not unreasonable for a lawyer to assume that no dismissal order would be made if he believes that he has not received the required notice.

[ 26 ] Furthermore, it is clear that the plaintiff’s lawyer was taking steps to move forward with the action around the time the dismissal notice was received. On February 4, 2011 he instructed Legal Link to carry out a further MTO search and apparently instructed a process server to serve the statement of claim at 64 Lawren Harris Crescent. In May, 2011, he sent copies of the statement of claim and affidavits of service to Economical. This does not evidence a deliberate decision to abandon a claim. Mr. Schacter took issue with the fact that the plaintiff has not provided any direct affidavit evidence of his intention to proceed with his claim. I agree that the best practice is to provide such evidence on motions of this nature. However, it is my view that such an intention can be reasonably inferred from the actions of the plaintiff’s lawyer. In my view, the failure to comply with Rule 48.15 was inadvertent. No other explanation makes sense.

[ 27 ] The plaintiff has therefore satisfied this element of the Reid test.

LITIGATION DELAY

[ 28 ] The court is generally not concerned with pre-litigation delay when considering this factor. The Reid factor in relation to litigation delay, as adopted by the Court of Appeal, only references delay in the progress of the litigation after the action has been commenced.

[ 29 ] On balance, I am satisfied that the plaintiff has met this element of the Reid test. The evidence clearly shows that the plaintiff was attempting to move this action forward by making repeated efforts to serve the statement of claim. The first attempt to do so was on July 26, 2010, only three weeks after the statement of claim was issued. Unfortunately, no one seemed to notice the fact that the service attempts were being carried out at the wrong address. I agree that the plaintiff and his lawyer could have done more. He could have contacted Economical. He could have employed a skip tracer at an early date. He could have carried out internet searches. He could have brought a motion for substituted service or for an extension of time, before the time for service expired. He did none of these things. Clearly there has been delay but I would not describe the period of delay as being inordinate.

[ 30 ] However, it is also my view that service may have been delayed by the fact that Shannon failed to update her address with MTO as she is required to do by section 33(1) of O. Reg. 340/94 under the HTA . Shannon’s evidence is that she did not drive or use her licence after moving to Mississauga. This, however, does not excuse her from complying with the requirements of the HTA regulations.

[ 31 ] In addition, the plaintiff was unable to obtain any results from his search on the plate number of Pamela’s vehicle, as listed in the accident report. The evidence does not indicate why the search was not successful. Perhaps the plate number had been recorded incorrectly on the accident report. Regardless of the reason, this avenue of inquiry was not available to assist the plaintiff in finding the defendants.

[ 32 ] The plaintiff’s explanation for the delay does not need to be perfect. It just needs to be adequate. I have concluded that it is. In my view, in the circumstances of this action, the plaintiff has satisfied this element of the Reid test.

PREJUDICE

[ 33 ] I am satisfied that the plaintiff has met the onus placed upon him to rebut the presumption of prejudice. Where a limitation period has passed, as it has here under the Limitations Act, 2002 , S.O. 2002, c. 24, Schedule B (the “Limitations Act”), there is a presumption of prejudice and the onus rests with the plaintiff to rebut that presumption. The strength of this presumptive prejudice increases with the passage of time. [^15]

[ 34 ] The operation of this factor was succinctly summarized by Master Dash in Vaccaro at paragraph 22 where he states as follows:

The presumption arises when an action is dismissed after the passage of a limitation period, even if the action was commenced within the applicable limitation period. Because memories of witnesses fade over time a presumption of prejudice would arise after passage of an inordinate length of time after a cause of action arose or after an applicable limitation period has passed. The force of the presumption [...] will depend on the time which has passed after the expiration of a limitation period as well as on the nature of the action. While the presumption will speak as a barely audible caution immediately after a limitation period has expired, it may command with increasing imperativeness on the passage of a substantial time, depending on the cause of action.

[ 35 ] A plaintiff can overcome this presumption by leading evidence that all relevant documents have been preserved, that key witnesses are available or that certain aspects of the claim are not in issue. [^16] In my view, the plaintiff has done so.

[ 36 ] This is a simple action involving a two vehicle collision. The two main liability witnesses, the plaintiff and Shannon, are obviously still available to give evidence. The event giving rise to the claim took place in November, 2008. While that is more than three years ago, it is not comparable to the passage of time in such cases as Wellwood , Giant Tiger , or Vaccaro . For that reason, I do not view the presumptive prejudice as being particularly strong in the circumstances of this action.

[ 37 ] The plaintiff’s lawyer appears to be in possession of relevant damages documentation including a complete accident benefits file, OHIP records, a property damage file, clinical notes and records from treating physicians, medical records, a long term disability file, income tax returns and an employment file. I do agree with Mr. Schacter that those documents could have been described in the plaintiff’s evidence with greater particularity. However, I am satisfied, on balance, that the evidence is sufficient to rebut the presumption of prejudice in the circumstances of this action.

[ 38 ] Finally, the defendants do not allege any actual prejudice caused by the plaintiff’s delay.

[ 39 ] I am therefore satisfied that the plaintiff has met this element of the Reid test.

CONCLUSION

[ 40 ] In deciding motions of this nature the court is to apply a contextual approach in which the court weighs all relevant factors to determine the result that is just in the circumstances. It is not necessary for the moving party to rigidly satisfy all of the Reid factors or any other relevant factors. Of the factors the court is to consider on motions such as this, prejudice is the key consideration. I am satisfied, on balance, that the plaintiff has met three of the four Reid factors. Most importantly, the plaintiff has rebutted the presumption of prejudice and the defendants have not alleged any actual prejudice caused by the plaintiff’s delay. Having weighed and considered all of the relevant factors, as set out above, it is my conclusion that it is just in the circumstances of this action that the registrar’s order of April 12, 2011 dismissing the plaintiff’s action be set aside.

[ 41 ] Similarly, given the lack of prejudice to the defendants, it is appropriate that an order be made extending the time for and validating service of the statement of claim. It is clear that the statement of claim came to the attention of the defendants by September 23, 2011, at the very latest, when service of the plaintiff’s motion record was accepted by Mr. Schacter on behalf of the defendants. I am therefore ordering that the time for service be extended to that date.

COSTS

[ 42 ] At the conclusion of the argument of this motion, counsel for the plaintiff advised the court that if the plaintiff was successful he would not be seeking his costs of this motion. Mr. Schacter argued that even if a plaintiff is successful on a motion of this nature, opposing defendants should be entitled to costs. See Evans v. Revenue Properties Co. , 2011 ONSC 2132 (Master) at paragraph 31 and Rule 57.01(2). In my view, this is an appropriate case to award costs against the successful plaintiff. All of the service difficulty encountered by the plaintiff may have been avoided had his lawyer paid closer attention to the accident report, the MTO searches and the affidavits of attempted service from his process server. This pattern of inattention continued right up to the date of the service of the plaintiff’s initial motion record in September, 2011. The plaintiff should have undertaken additional investigations in order to attempt to locate the defendants and should have communicated with Economical. In addition, the plaintiff’s supporting evidence could have been more detailed and specific with respect to the plaintiff’s intention to proceed with this claim and with respect to the damages documentation. The inconsistent affidavits with respect to the alleged service of the statement of claim are troubling, to say the least. The plaintiff has been granted an indulgence. Under the circumstances, it was not unreasonable for the defendants to have opposed this motion.

[ 43 ] The defendants seek costs on a partial indemnity basis in the amount of $7,800.00, inclusive of HST and disbursements. Mr. Scott does not take issue with this number. I have reviewed the defendants’ costs outline and, in my view, the amounts claimed appear to be fair and reasonable in the circumstances of this motion.

ORDER

[ 44 ] I therefore order as follows:

(a) the dismissal order of the registrar dated April 12, 2011 is hereby set aside;

(b) service of the statement of claim on the defendants is hereby validated and the time for service is extended to September 23, 2011;

(c) the defendants shall deliver their statement of defence by no later than July 17, 2012;

(d) the registrar shall not dismiss this action pursuant to Rule 48.15(1) before September 28, 2012;

(e) the plaintiff shall pay the defendants’ costs of this motion on a partial indemnity basis fixed in the amount of $7,800.00, inclusive of HST and disbursements, payable within 30 days.

Master R.A. Muir

DATE: May 17, 2012

[^1]: Scaini v. Prochnicki , 2007 ONCA 63 , [2007] O.J. No. 299 (C.A.); Marché D’Alimentation Denis Thériault Lteé v. Giant Tiger Stores Ltd. , 2007 ONCA 695 , [2007] O.J. No. 3872 (C.A.); Finlay v. Van Paassen , 2010 ONCA 204 , [2010] O.J. No. 1097 (C.A.); Wellwood v. Ontario (Provincial Police) , 2010 ONCA 386 , [2010] O.J. No. 2225 (C.A.); Hamilton (City) v. Svedas Koyanagi Architects Inc. , 2010 ONCA 887 , [2010] O.J. No. 5572 (C.A.); Machacek v. Ontario Cycling Assn. , 2011 ONCA 410 , [2011] O.J. No. 2379 (C.A.); Aguas v. Rivard Estate , 2011 ONCA 494 , [2011] O.J. No. 3108 (C.A.).

[^2]: Reid v. Dow Corning Corp. , [2001] O.J. No. 2365 (S.C.J. – Master) , reversed on other grounds [2002] O.J. No. 3414 (Div. Ct.) .

[^3]: Scaini at paragraphs 23 and 24 .

[^4]: Giant Tiger at paragraph 12.

[^5]: Scaini at paragraphs 23 and 24 .

[^6]: Scaini at paragraph 24 .

[^7]: Finlay at paragraph 28 .

[^8]: Wellwood at paragraph 60 .

[^9]: Wellwood at paragraph 60 .

[^10]: Giant Tiger at paragraph 12.

[^11]: Wellwood at paragraph 48 .

[^12]: Finlay at paragraphs 32 and 33 and Giant Tiger at paragraph 28.

[^13]: See Vaccaro v. Unifund Insurance Co. , 2011 ONSC 5318 (Master) at paragraph 34 and Wellwood at paragraphs 19 and 20 . Both of these decisions involved dismissals of actions as abandoned.

[^14]: Chiarelli v. Weins , 2000 3904 (ON CA) , [2000] O.J. No. 296 (C.A.) at paragraphs 14-17 .

[^15]: Wellwood at paragraph 60 .

[^16]: Wellwood at paragraph 62 .