SUPERIOR COURT OF JUSTICE - ONTARIO

COURT FILE NO.: 6721-12
DATE: 2012/06/06

RE: VENKATESHWARA R. MATTA and TAJ RESTAURANT & BAR CORP. (Plaintiffs)

-and-

KARUNAKAR R. INUKONDA c.o.b. as TAJ BAR & RESTAURANT, 6094759 CANADA LTD., REALTY EXECUTIVES ELITE LTD. and SANJEEV SAMUEL SINGH a.k.a. SAM SINGH (Defendants)

BEFORE: JUSTICE H. A. RADY

COUNSEL:
D. Sanders for the Plaintiffs

K. Finley for the Defendant K. Inukonda

ENDORSEMENT

[ 1 ] The defendants move under Rule 30.04 for the production of documents referred to by the plaintiffs in their statement of claim. Rule 30.04(2) provides:

A request to inspect documents may also be used to obtain the inspection of any document in another party’s possession, control or power that is referred to in the originating process, pleadings or an affidavit served by the other party.

[ 2 ] Rule 30.04(5) states:

The court may at any time order production for inspection of documents that are not privileged and that are in the possession, control or power of a party.

[ 3 ] The plaintiffs have refused the defendants’ request for documents and oppose this motion on the grounds that the defendants have not shown that the requested documents are necessary for the defendants to plead. The plaintiffs rely on Arthur Co. v. Runions, (1898), 18 P.R. 205 (Ont. Div. Ct.) . This case refers to the rule dealing with document production in place at the time, which stated:

The Court or a Judge at any time pending any action or proceeding, may order the production by any party thereto, upon oath, of such of the documents in his possession or power relating to any matter in question in such action or proceeding, as the Court or Judge thinks right; and the Court may deal with such documents, when produced, in any matter as appears just.

[ 4 ] The Court in Runions found that the practice to be followed under this rule was that “production should not be ordered to a plaintiff before he pleads, unless the judge is satisfied that the documents called for are essential to the plaintiffs’ claim.”

[ 5 ] The plaintiffs rely on this reasoning for the proposition that the defendants in this case must show that the documents, referenced by the plaintiffs in their statement of claim, are necessary for the defendants to plead. They further submit that their position is reinforced by the location of this rule in the “discoveries” rather than the “pleadings” section of the Rules of Civil Procedure.

[ 6 ] Unfortunately, the plaintiffs’ position misunderstands the purpose and history of this subrule.

[ 7 ] Brown J. reviewed the history of Rule 30.04(2) in Timminco Ltd. v. Asensio (2009), 2009 9431 (ON SC) , 95 O.R. (3d) 547 (S.C.J.) where he stated at paras. 17 and 18:

The rule traces its origins back to the nineteenth century English rules of court, and it appeared as Rule 350 in our pre-1985 Rules of Practice. In Quilter v. Heatly (1883), 23 Ch. D. 42 the English Court of Appeal held that the rule was "intended to give the opposite party the same advantage as if the documents referred to had been fully set out in the pleadings": quoted with approval in Durall Construction Ltd. v. H.J. O'Connell Ltd. , 1973 696 (ON SC) , [1973] 3 O.R. 59 (Master) ; see also Kenning v. Odaguchi , [1992] O.J. No. 1416 (Master) . Requests to inspect operate, in addition, to enable parties to review documents referred to in another's pleading to assist in preparing a responding pleading and to aid the requesting party in determining if the other's pleading discloses a reasonable cause of action or defence: Montreal Trust Co. of Canada v. Toronto-Dominion Bank (1992), 40 C.P.C. (3d) 389 (Ont. Ct. Gen. Div.) .

Nevertheless, it is not a pre-condition to an order for inspection that the documents be required for pleading: 1483881 Ontario Inc. v. KPMG , LLP, [2003] O.J. No. 2993 , 2003 CarswellOnt 2866 (Master) , para. 7 . In fact, the service of a request to inspect does not automatically extend the time for filing a defence. Where a request has been made and refused, courts have taken into account the necessity to inspect the documents before pleading over in considering whether to extend the time for filing a responding pleading: 1483881 Ontario Inc., supra. , para. 10

[ 8 ] In Kenning v. Odaguchi , [1992] O.J. No. 1416 , a case referred to by Brown J. in Timminco, Master Clark reminded litigants that Rule 30.04(2) deals with documents from a different perspective than Rule 30.04(1) noting that:

This latter rule is part of the discovery process that takes place after the pleadings are completed. But Rule 30.04(2) (the continuation of former Rule 350) has for its purpose the inspection of documents prior to pleading. In other words where a party refers to a specific document in pleading, that document is thereby incorporated into the pleadings. Where that occurs the opposite party is entitled to inspect the described document prior to pleading in response.

[ 9 ] The plaintiffs submit that these cases are wrongly decided. Instead, the plaintiffs refer to Canadian National Railway Corp. (CNR) v. Metropolitan Toronto Convention Centre Corp. (1994), 29 C.P.C. (3d) 248 (Ont. Ct. Gen. Div.) and Durish v. Bent (1985), 4 C.P.C. (2d) 37 (Ont. Master) as cases that correctly relied on the principle cited by the plaintiffs above. These cases are, however, distinguishable. CNR was not under Rule 30.04(2) but dealt with a request for production of documents by a third party. Similarly, there is no indication in Durish that the documents the defendant requested were referenced in the statement of claim.

[ 10 ] The plaintiffs submit that the defendants’ interpretation of the rule would allow any party at any time to demand and automatically receive any document. This is a misreading of Rule 30.04(2), which is limited to documents referred to in a pleading, affidavit, or originating process. This fairly provides the defendant with a means to obtain specific documents which the plaintiff has incorporated by reference into the statement of claim, but not with impunity to demand any document they might imagine exists.

[ 11 ] This interpretation of the Rules, supported by the case law above, is also supported by the general purpose and evolution of the rules away from trial by ambush and towards an emphasis on the fairest and most expedient resolution of litigation. As noted in Laurentian Bank of Canada v. Herzog (1999), 42 C.P.C. (4 th ) 269 (Ont. S.C.J.) by Pepall J. at para. 18: “[t]he Rules of Civil Procedure of 1985 were designed to provide for full disclosure, due process and avoidance of trial by ambush.” The defendants’ proposed interpretation is unsupportable when viewed in this light. It would go against the purpose and general evolution of the Rules of Civil Procedure to allow a plaintiff to make reference to specific documents in its pleading and then deny the defendant access to those documents.

[ 12 ] The relief sought in the motion is therefore granted. The time for the delivery of a statement of defence is extended to ten days after the delivery of the requested documents.

[ 13 ] I will receive brief written submissions on costs, from the defendants by June 15, 2012 and the plaintiffs by June 22, 2012.

“Justice H. A. Rady”

Justice H. A. Rady

DATE: June 06, 2012