COURT FILE NO.: CV-09-370499
DATE: 20121004
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
FREEDOM INTERNATIONAL BROKERAGE CO.
Plaintiff
– and –
TULLETT PREBON CANADA LIMITED, DENIS MARCOTTE and JOHN DOE(S)
Defendants
Michael Round, for the Plaintiff
Marc S. Kestenberg & Ilana Schrager, for the Defendant, Tullett Prebon Canada Limited and Chris Woolcock, Robert Wilson, Mike Fenech and Steve Periera, Defendants
HEARD: July 26, 2012
LEDERER J.:
[1] This is the continuation of a motion which began with a Notice of Motion, dated February 3, 2010.
[2] The plaintiff, Freedom International Brokerage Co. (“Freedom”), and the defendant, Tullett Prebon Canada Limited (“Tullett Prebon”) are both full-service inter-dealer brokers. They are intermediaries in the wholesale financial markets, facilitating the trading activities of their clients. They bring together buyers and sellers in matched trades. Freedom and Tullett Prebon are highly-competitive as intermediaries for bond trading in Canada. Both compete for substantially the same clients (financial institutions) and are both required to maintain the confidentiality of their clients’ trading data.
[3] In this action, Freedom alleges that Tullett Prebon, or people employed by it, conspired to surreptitiously obtain and unlawfully use, for its or their own benefit, proprietary information belonging to Freedom. The information was found on a confidential section of Freedom’s computer network. It is accessed through a “login page” using a confidential user name and password. Once logged in, the client obtains access to information that is confidential to it. The information is maintained by Freedom. It is not publicly available and is considered to be highly-sensitive.
[4] On or about December 19, 2008, Freedom became aware that a variety of client user names were logging in to confidential information using the same Internet Protocol (IP) address. Ultimately, after having the situation investigated, Freedom concluded that people employed by Tullett Prebon had, on numerous occasions, logged onto its network and wrongfully intercepted or gained access to information that was confidential and proprietary.
[5] In an affidavit, sworn on February 3, 2009, Michael Woolnough, Senior Vice President, Finance and Administration of Freedom, deposed that by surreptitiously becoming aware of information that is proprietary to Freedom, Tullett Prebon, or people employed by it, were able to determine that certain clients of Freedom were interested in buying or selling bonds at a particular price or that they held particular positions in the bond market. By utilizing this information, the people at Tullett Prebon were able to contact some of those clients and make offers to buy or sell bonds, on behalf of their own clients, that took advantage of the information that had been improperly obtained.
[6] As a result, the motion referred to in the opening sentence of these reasons was brought. Freedom sought, among other things, orders requiring Tullett Prebon to identify the individuals that had accessed the confidential information and the return of the information. The motion included a request for an interlocutory and interim injunction against Tullett Prebon, or those acting on its behalf, preventing them from accessing or acquiring proprietary information belonging to Freedom, communicating such information to others or in any way using, dealing in or selling the information. The motion also requested an order permitting Freedom to “…substitute any person as a defendant in this proceeding in place of John Doe(s)…”, which was used, in the Statement of Claim issued on or about January 19, 2009, to demonstrate there were further defendants that had not been identified at the time the action was commenced.
[7] The motion was to be heard on February 10, 2009. On that day, a consent order was signed which, in part, required the return of any confidential and proprietary information and enjoined the use, communication or further accessing of such information belonging to Freedom. It adjourned to April 6, 2009 the requests of Freedom for orders, including the provision of any information regarding the identity and contact information of the individuals who had been involved in obtaining the confidential information, as well as an order adding those individuals as defendants in the action, in place of the John Doe(s). The consent order was signed by me. It may or may not be important that I note that it is only by coincidence that the hearing of what remained came before me. Certainly, I was not seized.
[8] For whatever reason, the remaining matters were not heard on April 6, 2009, or at any other time, until it came to court on July 26, 2012. The Record explains that, in the interim, Stephen Goulet, Senior Managing Director of Tullett Prebon (Americas) had been cross-examined. Tullett Prebon is a subsidiary of Tullett Prebon (Americas). The cross-examination of Stephen Goulet led to a broad range of refusals. At least some of the time between February 10, 2009 and April 26, 2012 was taken up by a motion, unsuccessful appeal and a failed motion for leave to appeal directed to these differences.
[9] By the time the motion returned to court, Freedom was convinced that evidence and confidential information that had been in the possession of Tullett Prebon had been destroyed. It concluded that there was no purpose in proceeding with any request except for an order amending the Statement of Claim to add as parties, in place of John Doe(s), five individuals it had identified during the intervening period.
[10] For its part, Tullett Prebon, on or about February 20, 2009, which is to say, ten days after the consent order, prepared a Statement of Defence and Counterclaim. By the time the motion was to be heard, Tullett Prebon had decided to withdraw the counter-claim. The difficulty was that it wished the withdrawal to be without costs. As I understood it, counsel for Freedom would not object to the withdrawal, but wished to pursue costs. Ultimately, the parties agreed that Tullett Prebon would withdraw the counterclaim leaving it to Freedom to decide whether to pursue its costs of the counterclaim (see: Rule 23.05(1) of the Rules of Civil Procedure).
[11] As a result, the only issue left for me to resolve was whether the Statement of Claim should be amended to allow the five individuals to replace the John Doe(s) in the action.
[12] The parties agreed that using John Doe(s) can be a form of misnomer (see: Dukoff et al. v. Toronto General Hospital et al. (1986), 1986 CanLII 2648 (ON SC), 54 O.R. (2d) 58 (H.C.J.); Urie v. Peterborough Regional Health Centre, 2010 ONSC 4226, [2010] O.J. No. 3962); and, Spirito Estate v. Trillium Health Centre, 2008 ONCA 762. It should be said that this situation differs from the typical circumstance where the principle of misnomer is relied on. Generally, misnomer applies when a mistake is made in naming a party to an action. There is no mistake here. Freedom knew there was no defendant named John Doe. “John Doe” is used when, for whatever reason, a party cannot be identified. In this case, Freedom believes the five individuals it now seeks to include are proper defendants. The principles applicable to misnomer apply. The law regarding misnomer has changed (see: Essar Algoma Steel Inc. v. Liebherr (Canada) Company 2011 ONSC 1688, at paras. 7-12). More accurately, the law has expanded (see: Conestoga Badger v. Komatsu, 2012 ONSC 1871, at paras 9). In the past, the court would not allow an amendment in circumstances where an injured man sued what he thought was his employer (Elsby Brothers – a firm). In fact, the business had been taken over by a corporation (Elsby Brothers Ltd.). The court saw this, not as a misnomer, but as the substitution of one party for another (see: Davies v. Elsby Bros., [1961] 1 W.L.R. 170). The Court of Appeal has noted that the law has evolved. It has referred to the following as demonstrating the present test for a misnomer:
The case law amply supports the proposition that where there is a coincidence between the plaintiff’s intention to name a party and the intended party’s knowledge that it was the intended defendant, an amendment may be made despite the passage of the limitation period to correct the misdescription or misnomer. See Ladouceur v. Howarth, 1973 CanLII 30 (SCC), [1973] S.C.J. No. 120 (S.C.C.); Kitcher v. Queensway General Hospital, 1997 CanLII 1931 (ON CA), [1997] O.J. No. 3305 (C.A.) and J.R. Sheet Metal & Manufacturing Ltd. v. Prairie Rosewood Products, 1986 ABCA 4, [1986] A.J. No. 7 (C.A.).
(Lloyd v. Clark, 2008 ONCA 343, [2008] O.J. No. 1682, at para. 4, as quoted in Ormerod v. Strathroy Middlesex General Hospital, 2009 ONCA 697 at para. 21and subsequently referred to in Conestoga Badger v. Komatsu, supra, at para. 8 and in Essar Algoma Steel Inc. v. Liebherr (Canada) Company, supra, at para. 12)
[13] This approach was utilized in Ormerod v. Strathroy Middlesex General Hospital, supra. The family of a dead man sued an emergency room physician. The doctor had not treated the deceased. The court allowed the claim to be amended to name the doctor who had looked after the man. In Essar Algoma Steel Inc. v. Liebherr (Canada) Company, supra, the same approach was used and the name of an Austrian corporation substituted, as a defendant, for the previously named defendant Canadian corporation. In Conestoga Badger v. Komatsu, supra, the plaintiff was permitted to amend its Statement of Claim by replacing one of the named defendants, Komatsu International (Canada) Inc. (a Canadian subsidiary), with the intended defendant, Komatsu America Corp.
[14] The first part of the test, the intention of the plaintiff, is identified “…not by what the writer of the document intended but what a reasonable man reading the document would understand it to mean…” (see: Davies v. Elsby Bros., supra, at p. 4, as referred to in Essar Algoma Steel Inc. v. Liebherr (Canada) Company, supra, at para. 14).
[15] The second part of the test, the knowledge of the prospective party that it was the intended defendant, has been referred to as the “litigating finger test”, and is described as follows: “…would a reasonable person, upon reading the document, know that she is the intended recipient (or that the ‘litigating finger’ was pointed at her)?” (see: Sorokataya v. Keith, [2010] O.J. No. 3429, at para. 9; and see also Jackson v Bubela, 1972 CanLII 978 (BC CA), [1972] B.C.J. No. 736, 28 D.L.R. (3d) 500, at para. 5; Dukoff et al. v. Toronto General Hospital, 1986 CanLII 2648 (ON SC), [1986] O.J. No. 188, (1986), 54 O.R. (2d) 58; Ormerod v. Strathroy Middlesex General Hospital, supra, at paras. 14, 22 and 24; and Spirito v. Trillium Health Centre, 2008 ONCA 762, [2008]O.J. No. 4524, 69 C.P.C. (6th) 36, at para. 5).
[16] In Ormerod, the Court of Appeal observed that the motions judge had broadened this part of the test. He had observed that the “reasonable person receiving the document” was not restricted to the person to be named as a defendant: “Rather the cases have been expanded to include the ‘relevant person’ who reviews the document” (see: Ormerod v. Strathroy Middlesex General Hospital, supra, at para. 12; and Urie v. Peterborough Regional Health Centre, supra, at para.109).
[17] In applying the first part of the test, it must have been clear to the author of the document and would have been clear to the reasonable person reading the document that the intention was to replace the “John Doe(s)” with known and identifiable individuals against whom the allegations leading to the law suit were directed. The use of “John Doe” as a substitute when the actual individual cannot be identified is a well-known and accepted artifice. Even Black’s Law Dictionary includes a definition for “John Doe” as:
A fictitious name used in a legal proceeding to designate a person whose identity is unknown, to protect a person’s known identity, or to indicate a true defendant does not exist.
[Emphasis added]
(Black’s Law Dictionary, Eighth Edition, Bryan A. Garner, Editor-in-Chief)
[18] As this definition confirms, the use of John Doe as a surrogate can only occur where the identity of the true defendant is unknown. It is to be discovered through the processes of the action (for example, Examination-for-Discovery or, as in this case, cross-examination on an affidavit). The intention of the plaintiff, where John Doe is named as a defendant, has to be explained through an understanding of the nature of the actions that it is alleged give rise to liability. What these are should be evident from a reading of the Statement of Claim. It is the people who were involved in or responsible for those actions that the plaintiff intends to sue.
[19] This leaves the second and more complicated part of the test. It is important to acknowledge the risk inherent in this analysis. Where misnomer is established, it becomes a basis for overriding any applicable limitation period. This means that any misnomer should be clear; otherwise, the concept can be misused to add new parties after the limitation period has expired. The point of the test is that the party being identified, represented as the relevant person reading the document, is taken to have known that they were the proper party being sued (albeit improperly named) before the limitation period passed by:
The test must be: How would a reasonable person receiving the document take it? If, in all the circumstances of the case and looking at the document as a whole, he would say to himself: ‘Of course it must mean me, but they have got my name wrong’. Then there is a case of mere misnomer. If, on the other hand, he would say: ‘I cannot tell from the document itself whether they mean me or not and I shall have to make inquiries’, then it seems to me that one is getting beyond the realm of misnomer.
(Davies v. Elsby Brothers, Ltd., [1960] 3 All E.R. 672 (C.A.), at p. 676, as adopted in Dukoff et al. v. Toronto General Hospital et al, supra, and referred to in Spirito Estate v. Trillium Health Centre, supra, at para. 12)
[20] In effect, the parties being named are taken to have had notice and to have been sued within the time provided (see: Spirito Estate v. Trillium Health Centre, supra, at para. 5).
[21] In Urie v. Peterborough Regional Health Centre, supra, a law suit was launched in the days just before the expiry of the limitation period. Fifteen John Does were referred to as having been involved in the care of the plaintiff following his fall from a ladder. Claiming misnomer in respect of the John Does, the plaintiff then sought to name two doctors and five nurses. The motion was dismissed. The pleadings were not specific:
Starting with a review of the statement of claim, issued on June 20, 2005 which is the same date as the anniversary of the two year limitation expiration under subsection 38(3) of the Trustee Act, the claim can best be described as a shotgun approach to identifying the relevant persons who are said to have been negligent in the care of Mr. Urie. It is far from a document that points the litigating finger. The claim is poorly drafted and devoid of specificity as it relates to the torts alleged. Essentially it was originally an attempt to capture a pool of medical professionals within the nomenclature of a total of 15 John Does. There appears to be no justification for picking 15 such persons as distinct from the now proposed seven or for that matter any other arbitrary number. Given the date of issuance of the claim, which just made it under the wire of the limitation period, it is fair to assume that the claim was meant to be a prophylactic attempt to place the plaintiffs under the umbrella of the limitations period, without regard to any attempt to actually name those that are suggested to have been negligent in the care or Mr. Urie.
(Urie v. Peterborough Regional Health Centre, supra, at para. 114)
[22] As counsel for Tullett Prebon observed, if the pleading points at everyone, it points at no one. The question is whether the Statement of Claim identifies the prospective defendants (see: Spirito Estate v. Trillium Health Centre, supra, at para. 11).
[23] It does seem to me that some additional comment is warranted. The relevant person reading the Statement of Claim should be taken to understand that, in identifying those being sued, the litigating finger may cast a wide shadow. Depending on the substance of the allegations being made, it could point at anybody the plaintiff has reason to suspect could be liable. The test is not limited only to those who are legally liable or to those who would be liable if there is liability to be assessed. In the present day, it is accepted that counsel for the plaintiff, in launching a law suit, will want to include all those who could possibly carry some of the liability. This is especially so in this case. Tullett Prebon has pleaded that, if any of its employees accessed information belonging to Freedom, it is not vicariously liable for those actions. From the point of view of the plaintiff, this underscores the need to name the individuals who may bear some or all of whatever liability there may be. In satisfying the second part of the test, the “relevant person” who reads the Statement of Claim should be taken to be aware of the importance of including all the appropriate defendants and the breadth of the net that may be cast in fulfilling that responsibility.
[24] The upshot of this is that there is a balance to be struck. On the one hand, the prospective defendant must be able to identify that he or she was an intended party to the law suit but, on the other hand, in considering the possibility, must recognize the broad range of those at whom the litigating finger is pointing.
[25] In considering the second part of the test, the Statement of Claim has to be reviewed. It is clear that such an assessment “…is required to analyze whether the case falls within the misnomer category. This assessment will define whether a litigating finger is in play or if the claim aims itself at a moving target” (see: Urie v. Peterborough Regional Health Centre, supra, at para. 107).
[26] The Statement of Claim, in its present form, at paragraph 5, contains the following allegation:
The specific identity of the defendant or defendants named in this proceeding as John Doe is not currently known to Freedom but is known to the defendants. John Doe is an individual or entity that either itself accessed or intercepted the Freedom Proprietary Information, or alternatively had the Freedom Proprietary Information supplied to it by one or more of the named defendants, and then used or is improperly using the Freedom Proprietary Information. John Doe may be more than one person or entity and may include various bond traders employed by Prebon.
[Emphasis added]
[27] The Statement of Claim, in its present form, at paragraph 31, includes a further allegation which implicates John Doe(s):
In December, 2008 the defendants learned that some evidence of their improper activities had been discovered by Freedom and that litigation would likely result. In response, in an effort to protect themselves from liability, the defendants took steps to destroy records that evidenced their unlawful activities, including their conduct directed at Freedom. In particular, the defendants caused electronic and written records in their possession to be deleted, destroyed or otherwise made inaccessible to Freedom for evidentiary purposes….
[Emphasis added]
[28] These paragraphs advise of two independent allegations. The first, that the defendants improperly accessed and used the confidential information belonging to Freedom; and the second, that on being discovered, the defendants destroyed at least some of that information. Among other things, Freedom claims damages resulting from the accessing, use and destruction of the information, as well as remedial sanctions for spoliation in respect of the destruction.
[29] What seems apparent is that the plaintiff, Freedom, intended to name those who accessed, used and destroyed confidential information. This deals with the first aspect of the test. The issue remains whether those at Tullett Prebon (the relevant persons), on reading the Statement of Claim, would have understood the litigating finger to be pointing in their direction. Where fictitious names such as John or Jane Doe are used, it is this assessment that becomes seminal in the analysis (see: Urie v. Peterborough Regional Health Centre, supra, at para. 107).
[30] In this case, of the five prospective defendants, two are the only employees in the Information Technology (“IT”) group at Tullett Prebon (Mike Fenech and Steve Periera). One is the Director of Securities (Rob Wilson) and another was the Chief Operating Officer of Tullett Prebon (Chris Woolcock). The fifth was a broker (Tim MacDonald). The broker has left Tullett Prebon and has provided evidence to Freedom.
[31] The amendments to the Statement of Claim that are proposed and would put in place the naming of the five prospective defendants allege that:
- the two employees in the IT group (Mike Fenech and Steve Periera) “facilitated access” to the confidential information so that it could be improperly used by “….the other individual defendants” and that they participated in the destruction of the evidence.
- the Director of Securities (Rob Wilson) “facilitated access” to the confidential information so that it could be improperly used by “….the individual defendants”.
- the Chief Operating Officer of Tullett Prebon (Chris Woolcock) “facilitated access” to the confidential information so that it could be improperly used by “…the other individual defendants” and directed and participated in the destruction of the evidence that was contained on Tullett Prebon’s computers.
- the broker (Tim MacDonald) accessed, intercepted and improperly used the confidential information.
[32] Of the five prospective defendants, four (Mike Fenech, Steve Periera, Chris Woolcock and Rob Wilson) are alleged to have “facilitated access” to the confidential information to be used by others. Counsel for Tullett Prebon (and for these four prospective defendants) submitted that this is not consistent with the Statement of Claim. There is a difference between “accessing” and “using”, as referred to in the Statement of Claim and “facilitating access” to others so that the information can be “improperly used by others”. As counsel sees it, only the brokers would have “accessed” and “used” the confidential information as alleged in the Statement of Claim. Others, like those working in, or supervising the IT department, would not have identified themselves as “accessing” or “using” the information. They would not have seen the litigating finger as pointing at them. Counsel submitted that the allegations found in the proposed amendments (“facilitating access” so the information could be “improperly used by others”) were new and that this is not a misnomer. Rather, it is an amendment to the claim and an attempt to add new parties.
[33] It is here, when accepting “…it must mean me, but they have got my name wrong”, that the prospective defendant should recognize the broad scope of pleading. Counsel for Tullett Prebon suggested that, for any of these four prospective defendants to conclude that the litigating finger was pointing at them, they would have to identify as individuals who were vulnerable to the allegation that they both “accessed” and “intercepted” the information. How this could be when the Statement of Claim says “accessed or intercepted” escapes me but, more importantly, it proposes a narrow reading of the Statement of Claim. “Accessing” and “intercepting” are nothing more than two ways of acquiring the information which the defendants were not entitled to have. In this situation, a person would not have to be susceptible to an allegation of doing both before the litigating finger would point his or her way. One would do.
[34] This takes me to the fulcrum on which much of this case turns. Does the phrase “facilitating access in order that the information can be used by others” introduce a new claim not present in the words “accessing and using”? If it does, it would only be with its appearance in the proposed amendments to the Statement of Claim that the members of the IT department would have recognized that they could be sued – that the litigating finger was pointing at them. To my mind, “facilitating access” is subsumed in and part of “accessing”. The person who “facilitat[es] accessing” is contributing to the accessing of the information. It is part of the same activity.
[35] The substance of the action is the improper obtaining and use of confidential information. The Statement of Claim alleges that those at Tullett Prebon accessed or attempted to access Freedom’s confidential network on over 22,000 occasions between 2007 in December 2008. In the context of a program of accessing such information from the computer network of a competitor, those who work in or are responsible for the IT department would recognize, when they read the Statement of Claim, that the litigating finger was pointing at them. It is not so much that “…it must mean me” as it is that “it must include me”. It amounts to the same thing.
[36] Once the information has been accessed, whether it is used by the person or people who accessed it or it was passed on to be used by others, the pointing of the litigating finger has been established.
[37] Having determined that those working in the IT department, or responsible for that work, would have recognized that the litigating finger was pointing in their direction, the question remains which of these four prospective defendants are included? Mike Fenech and Steve Periera were identified as the “only” employees within that department. The factum, filed on behalf of the four prospective defendants, admits that, in this capacity, Mike Fenech and Steve Periera worked “under the direct supervision” of Chris Woolcock.
[38] I find that Mike Fenech, Steve Periera and Chris Woolcock would have recognized that the litigating finger was pointing at them.
[39] Rob Wilson is said to have held the position of Director of Securities at Tullett Prebon. Unlike the defendant, Denis Marcotte, who is identified as President of Tullett Prebon and described as being “responsible, among other things, for directing the activities of Prebon’s bond traders”, nothing is said that would advise the reader as to the responsibilities of Rob Wilson. As far as I can see, there is no description of his responsibilities as Director of Securities. So far as I am aware, this is not a term of art. Director of Securities is not an identification that would be necessarily understood. In the circumstances, there is no way of knowing what role was played by Rob Wilson in the operation of Tullett Prebon. There is no basis for me to find that Rob Wilson, as a relevant person, would identify himself as someone who must have been included in the Statement of Claim. Without this, I cannot tell if Rob Wilson should have realized that the litigating finger was pointing in his direction.
[40] In the proposed amendments to the Statement of Claim, three of the four prospective defendants to whom I have so far referred (Chris Woolcock, Mike Fenech and Steve Periera) are also alleged to have “participated in the destruction of the evidence”. In the absence of the allegations concerning the accessing of the confidential information, this might have proven to be a much more difficult question. While nothing was said by counsel, it does not seem out of place for me to suggest that it may be far easier to destroy information than it is to access the confidential parts of the network of a competitor. Most computers have a “delete” button. Deleting, that is destroying, the information would not so clearly point to the IT department. If this is so, there might have been an argument that, in respect of destroying the evidence, the Statement of Claim did not result in the litigating finger pointing at anyone. It would, arguably, have been pointing at every employee at Tullett Prebon. As it is, it is difficult to separate the allegation that the material was destroyed from the proposition that the information was improperly accessed and used. It is reasonable to suppose that the same people were involved. Those alleged to have destroyed the evidence are the two members of the IT department and the person who supervised them.
[41] There was a suggestion that Rob Wilson was present at a meeting on January 7, 2009, where the defendant, Denis Marcotte, ordered Chris Woolcock to erase incriminating evidence from the computers used to access the Freedom computer network. This could be taken to confirm that the litigating finger was pointing at Chris Woolcock. It does not extend to propose that it was similarly directed at Rob Wilson. The amendments to the Statement of Claim put forward on this motion do not allege that Rob Wilson was involved in the destruction of any material. It is only said that he facilitated access to the confidential information so that it could be improperly be used by others.
[42] I have not as yet referred to the fifth of the five proposed defendants. Tim MacDonald was not present or represented on the motion. He was a broker with Tullett Prebon. As I have already observed, counsel for Tullett Prebon acknowledged that it was the brokers his client understood would have been involved if any accessing or use of confidential information took place. It was noted, in the evidence he provided to Freedom, that Tim MacDonald admitted that he had accessed confidential information from the computer network of Tullett Prebon. This was confirmed by the observation of others (Brian Blundon, Andrew Cooper, Daniel Field and Denis Marcotte). I find that Tim Macdonald would have recognized the litigating finger was pointing at him.
[43] As it is, I would find that each of Chris Woolcock, Mike Fenech, Steve Periera and Tim MacDonald have been the subject of misnomer. There is one question that remains.
[44] The broadening of the understanding of what is required to demonstrate misnomer has been accompanied by the recognition of the widening of a residual discretion, in the court, to refuse an amendment that may otherwise qualify as a misnomer:
As I see it, as the scope of what the courts treat as a misnomer broadens, it is appropriate to take a wider view of the court's discretion to refuse the correction of a misnomer. A 'classic' misnomer, one in which the claim contains a minor spelling error of the defendant's name and is personally served upon the intended but misnamed defendant, prompts the application of a standard historically developed to remedy mere irregularities. Now that the concept of 'misnomer' has been broadened to apply to a wider range of situations, the standard used to permit its correction should take into account the extent of its departure from mere irregularity in all circumstances of the case.
The factors the motions judge applied in this case, whether the defendant was misled or was unduly prejudiced, are undoubtedly deserving of the greatest weight. As a general principle, these factors should be determinative. A general principle, however, is not an inflexible rule. Where the mistake in naming the defendant involves more than a mere irregularity or in any particular case with exceptional circumstances, the court may exercise its residual discretion under the rule to refuse to permit its correction.
(Ormerod v. Strathroy Middlesex General Hospital, supra, at paras. 31 and 32)
[45] A factor in the exercise of this residual discretion can be delay:
If the case is truly one of a misnomer, delay is a factor in the exercise of the motion judge’s discretion whether to allow an amendment for misnomer.
(Urie v. Peterborough Regional Health Centre, supra, at para. 103)
[46] In this case, the Statement of Claim was issued on or about January 19, 2009 and served on February 4, 2009. The motion referred to in the opening sentence of these reasons was scheduled to be heard on February 10, 2009 and resulted in the consent order signed by me on that day. It was followed by the effort to complete the cross-examination of the deponent of the affidavit sworn on behalf of Tullett Prebon. This entails the original cross-examination, a motion with respect to refusals, an appeal of that motion and a further unsuccessful motion for leave to appeal. Ultimately, this process was completed by the delivery of information on October 7, 2009.
[47] At the same time, Tullett Prebon prepared and served a Statement of Defence and Counterclaim, dated February 20, 2009. The counterclaim was based on the belief of Tullett Prebon that Freedom had circulated a defamatory letter to their common clients with the objective of damaging the business of Tullett Prebon. Freedom sought particulars. In response, Tullett Prebon asked for production of the letter. Freedom did not deny the existence of the letter, but refused to produce it for inspection. A motion brought for production of the letter was heard on April 17, 2009. Freedom was ordered to produce the letter on or before April 22, 2009. Freedom responded. It advised that a search had been completed and that “to the best of our client’s knowledge information and belief” no letters have been sent to clients of Tullett Prebon in either late December 2008 or early January 2009 alleging that Tullett Prebon had improperly accessed confidential information belonging to Freedom. Tullett Prebon did not accept that this demonstrated compliance with the order to produce the letter. An appeal of the order requiring production was commenced. In a decision, released on October 14, 2009, the appeal was ruled to be out-of-time.
[48] It seems that nothing happened between October 2009 and February 7, 2011. A Status Notice was issued by this Court. On April 29, 2011, counsel for Freedom delivered its supplementary motion record in furtherance of bringing the motion back to court. On May 12, 2011, Freedom advised, without qualification, that no defamatory letter had been sent.
[49] What follows from this is that, from October 2009 to February 7, 2011, both parties allowed this action to stand in abeyance. Generally, it is the responsibility of the plaintiff, in this case Freedom, to move the action forward. It is true that, as of October 7, 2011, the cross-examination of the witness from Tullett Prebon and the motions which proceeded from it had been completed. The information that resulted from this part of the process had been delivered. It is also true that the unconditional concession that there was no defamatory letter which had been delivered to the clients of Tullett Prebon could have been produced much earlier than it was. Nonetheless, neither party has proceeded with the alacrity that would demonstrate a commitment to moving this matter to a conclusion. For its part, Tullett Prebon could have determined not to appeal the motion concerning its refusals or to continue on to seek leave after the initial appeal failed. Certainly, Tullett Prebon was within its rights to appeal but it, and its employees, must accept that in doing so, it delayed the identification, by Freedom, of the individuals Freedom now seeks to include as defendants. Moreover, the denial by Tullett Prebon that it would be vicariously liable for the acts of its employees, while possible, seems hard to imagine if the allegations made by Freedom are true. If there is any truth in this observation, the denial accomplished nothing more than to unnecessarily complicate the process in a fashion which underscored the need for the individual defendants to be properly named.
[50] In the circumstances, I find that the both parties share whatever fault is to be assessed for the failure for this matter to proceed with the proper expedition. I am not prepared to exercise any discretion I may retain to deny the motion.
[51] Insofar as it addresses Chris Woolcock, Mike Fenech, Steve Periera and Tim MacDonald, the motion is granted. Insofar as it addresses Robert Wilson, the motion is denied.
Costs
[52] If the parties are unable to agree as to costs, I will consider submissions in writing on the following terms:
On behalf of Freedom, no later than fifteen days after the release of these reasons. Such submissions are to be no longer than four pages, double-spaced, not including any Costs Outline, Bill of Costs or case law that may be referred to.
On behalf of Tullett Prebon, no later than ten days thereafter. Such submissions are to be no longer than four pages, double-spaced, not including any Costs Outline, Bill of Costs or case law that may be referred to.
On behalf of Freedom, no later than five days thereafter, in reply. Such submissions are to be no longer than one page, double-spaced.
LEDERER J.
Released: 20121004
COURT FILE NO.: CV-09-370499
DATE: 20121004
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
FREEDOM INTERNATIONAL BROKERAGE CO.
Plaintiff
– and –
TULLETT PREBON CANADA LIMITED, DENIS MARCOTTE and JOHN DOE(S)
Defendants
JUDGMENT
LEDERER J.
Released: 20121004