Court File and Parties

COURT FILE NO.: 08-CV-354637

MOTION HEARD: October 11, 2012

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: 08-CV-354637

Hall et al. v. Hon –Lin Ma

BEFORE: Master Joan Haberman

COUNSEL: Gilbert, S.D. for the moving party

Vaughn, H. for the responding party

REASONS

Master Haberman:

[1] The plaintiffs (the Halls) move to set aside the registrar’s order, dated July 8, 2010, pursuant to which this action was dismissed as abandoned.

[2] Having reviewed all of the materials filed and after hearing the submissions of counsel, I dismissed the motion on October 11, 2012, with written reasons to follow. I have now had an opportunity to complete those Reasons.

PLAINTIFFS’ EVIDENCE

[3] Sarah Hall sue for injuries allegedly allegedly sustained in a motor vehicle accident that occurred on May 13, 2006. Her parents seek damages pursuant to the Family Law Reform Act.

[4] The action was commenced by statement of claim, issued by the Halls’ previous counsel, Daniel Daly, on May 12, 2008, the eve of the expiry of the applicable limitation period.

[5] The motion record contains no affidavit from Mr. Daly. As a result, there is a very large gap in the Halls’ evidence, in terms of what was done by Daly after he issued the claim and before the action was dismissed. There are also no affidavits filed by any of the Halls, therefore no evidence regarding what inquiries the Halls may have made about the apparent lack of progress of the action or what they were told by Daly over time. In fact, there is no evidence filed on behalf of the plaintiffs addressing any aspect of what took place the time the claim was issued in 2008 until well after the action was dismissed, when the file was transferred to current counsel in December 2011. .

[6] Instead, Mr. Halpern, current counsel, has tried to cobble together what he believes happened and why the action stalled. His views are based on what he has and has not found in the file. However, a lot of what he suggests as a basis for Mr. Daly’s apparent inaction involve speculation rather than concrete evidence. It is also, in large part, contradicted by evidence filed by the defendant. There is no reply evidence from the plaintiffs so the defence record stands, unchallenged.

[7] Mr. Halpern’s evidence also contains a considerable amount of hearsay on key points. I will deal with this as I come to it. All in all, the record filed on behalf of the Halls is troubling, particularly in light of what was at stake in this motion

[8] I reiterate a point I have made repeatedly over the years – regardless of the legal test or how well a party’s facts mesh with that test, unless they put those facts before the court as evidence in proper form, they will be unable to rely on them to advance their client’s position.

[9] At trial, witnesses go into the box and give viva voce evidence. They are examined in court in chief and then cross-examined in court. This is a time consuming process, but considered necessary and appropriate in the context of a trial.

[10] On motions, evidence is put before the court by way of sworn affidavits, crafted and delivered in advance of the hearing. The only available routes in our system for challenging evidence is by filing responding evidence or/or by cross-examination on the evidence filed. Cross-examination in this context is conducted before the motion comes to court. Our system simply does not have the resources to approach this issue any other way in the context of motions.

[11] As a result, it is critical, when bringing or resisting a motion, to carefully consider the legal test that must be met and to draft evidence in affidavit form with the legal test in mind. The moving party effectively gets an opportunity to supplement their work after responding materials have been filed as they can then file reply evidence to address new issues raised. This is an opportunity they should avail themselves of where appropriate.

[12] Once the hearing of a motion begins, there is no mechanism available to allow a party to add to or correct the record, short of seeking an adjournment, which will not be granted as a matter of course. None was sought in this case, though the evidentiary gaps were identified by the court at the outset of the hearing.

[13] It is trite law to state that new information cannot be introduced at the hearing through the mouth of counsel who simply “tells” it to the court.

[14] The only evidence filed by the Halls in support of their motion is Mr. Halpern’s affidavit. It appears that he was very late on the scene. He states that his firm was not retained by the Halls until December 16, 2011 and that, on the very same day, he instructed his process server to check the court file to determine the status of the action.

[15] Mr. Halpern states that, on December 20, 2012, he learned from the process server that the action had been dismissed on July 8, 2010, more than two years earlier. He states that this was the first time the firm became aware of the dismissal. This is not surprising – as they had only just been retained, they would have had no interest in the matter earlier.

[16] This is also not terribly relevant. As Mr. Halpern’s firm was not the office that had initiated process, when they learned of the dismissal is far less important than when Sarah Hall and her parents learned about it; when her former counsel learned of it; or when he ought to have known about it. However, evidence in proper form addressing these key issues was not filed by the Halls.

[17] Instead, Mr. Halpern states that he was told by Sarah that she was unaware of the dismissal until his office informed her about it. This is hearsay evidence. There is no direct evidence from Sarah on this point, nor does Mr. Halpern address the issue of whether Sarah’s parents were also left in the dark - the affidavit is silent as regards these members of the Hall family, Sarah’s co-plaintiffs. I can give little weight to evidence in this form when it deals with an important point.

[18] Mr. Halpern goes on in his affidavit to state that on the day he was retained, he also wrote to Mr. Daly. As he received no response, he wrote again on January 23, 2012. In both letters, Mr. Halpern asked only for the file. Though the second letter was written more than a month after Mr. Halpern had learned that the action had been dismissed, he apparently did not raise this with Mr. Daly, nor did he seek information or an explanation from him as to what had transpired after the claim was issued. He does not even appear to have asked Mr. Daly if he was aware of the dismissal.

[19] Mr. Halpern states that his firm received the Hall file, minus correspondence, on February 14, 2012, so it seems that, at least at this point in time and in this regard, Mr. Daly was responsive – he made the Hall file available when asked. It is not clear if he was aware at that time of the dismissal order, and there is no evidence to suggest that Mr. Halpern ever brought this fact to his attention.

[20] There was some suggestion from counsel regarding what he referred to as Mr. Daly’s lack of cooperation. There is no evidence addressing this issue, however, or regarding what Mr. Daly was asked and when and what, if any, response was received. Mr. Daly’s role in all of this is contentious – what he did or failed to do and why is at the root of this motion. Having direct evidence before the court regarding why he has not sworn an affidavit here was therefore crucial.

[21] Mr. Halpern states that upon receipt of the file, he reviewed it and came across an affidavit of attempted service on Robert James Sutton, dated June 4, 2008. In it, Mr. Sutton speaks of his three unsuccessful attempts to serve the defendant in this action. The final attempt, made on May 13, 2008, revealed that the defendant had moved to Vancouver.

[22] Mr. Halpern strays into hearsay evidence yet again at paragraph 10 of his affidavit. Instead of having his law clerk swear her own affidavit, he relays what she told him about her conversation with the adjuster acting for the defendant’s insurer that took place on June 7, 2012. Apparently, the adjuster confirmed that the defendant resides in Vancouver. The precise address was apparently provided.

[23] Mr. Halpern includes two driver searches, one conducted on May 10, 2007 on behalf of Mr. Daly’s office, the other on June 7, 2012. He apparently found it “notable” that the more recent search continues to show the same address as that reflected in the 2007 search, both in Toronto. He does not explain why he finds this notable, and in view of the defendant’s evidence, it turns out that nothing at all turns on this. Regardless of what the search states, no motion was brought for leave to affect substituted service at the Toronto address.

[24] In paragraph 12 of his affidavit, Mr. Halpern ventures again into the arena of pure speculation. He states that he believes it was Mr. Daly’s intention to serve the claim and that the defendant’s failure to keep the address on his licence current may have made him difficult to locate. The defendant’s evidence which follows, however, makes it clear that this speculation is completely without foundation, as Mr. Daly was actually given the Vancouver address for service early on and repeatedly thereafter by the defendant’s insurer, but for some unknown reason, he failed to act on it.

[25] In fact, it is clear that Mr. Halpern has no idea what was going on in Mr. Daly’s head, nor does he state in his affidavit why he did not try to find out. As a result, Mr. Daly’s failure to serve the claim remains a mystery.

[26] Mr. Halpern asserts that he was advised by Sarah Hall that it was always her intention to proceed with the action – yet more hearsay evidence. There is no direct evidence from Sarah to this effect and no reference to whether her parents shared this intention.

[27] There is further hearsay evidence regarding Mr. Halpern’s discussions with Sarah, to the effect that she continued to correspond with Mr. Daly after the action had been dismissed. She apparently received a letter from his clerk, Ms. Tadus, dated August 22, 2011, seeking further damage particulars. A copy of that letter was not appended to the Halpern affidavit. Instead, solicitor-client privilege is claimed. That letter, in redacted form, should have been made part of this record, in view of what is at stake.

[28] The motion was initially scheduled to be heard on June 21, 2012, but was put over to October 22, 2012. Mr. Halpern maintains that it was brought promptly – however, in light of the complete absence of evidence from Mr Daly regarding what he knew (or should have figured out), coupled with the lack of direct evidence from any of the plaintiffs regarding what they knew or asked or failed to ask, this is not a tenable submission. The relevant time period does not begin when new counsel comes on board – in the absence of any evidence from Mr. Daly stating that he nothing about the order and some indication as to why he missed the deadline, this timeline began on the date of the dismissal order, July 8, 2010.

[29] Mr. Halpern also asserts that the defendant would suffer no prejudice if the action was reinstated. He speaks generically of what documents are available, and does not touch on the more problematic areas raised by the defendant in their record, either in this affidavit or by way of a reply affidavit.

THE DEFENDANT’S EVIDENCE

[30] The defendant’s evidence comes in through the affidavit of Alan Ing, claims examiner for Northbridge (formerly Lombard) Insurance, the defendant’s insurer. It is based largely on his review of the insurer’s file.

[31] Ing states that Lombard first got notice of the claim on September 20, 2006, in the form of a letter from Mr. Daly regarding his retainer.

[32] Lombard’s adjuster, Roman Lau, wrote to Mr. Daly on February 26. 2007, requesting several documents including the OHOP summary. Lau apparently sought these documents to assist him in assessing whether the injury met threshold.

[33] By response of April 16, 2007, Mr. Daly advised that the information would be shared “in the fullness of time.” He also mentioned that his client had returned to the US. No documentation was provided to Lombard at that time nor is there any evidence that Mr. Daly set about accumulating any of the materials requested at that time or at any time thereafter.

[34] On April 17, 2007, Mr. Daly’s office wrote to Lombard, seeking the proper spelling of the defendant’s name and asking for the face page of his policy with them. Both were provided, along with the defendant’s Toronto address at that time, August 15, 2008.

[35] Mr. Daly finally provided some documentation to Lombard under cover letter of August 15, 2008. A prescription profile printout from 2007-8; a medical expense printout from January to September 2008 and a Crest Pharmacy custom log printout dated August 76, 2008 were sent, along with a statement printout from a Dr. Caron, running from January 1, 2008-August 6, 2008.

[36] On August 19, 2008, Mr Daly wrote again, to advise that Ms. Hall was reportedly receiving ongoing treatment and care. He advised that he had requested the family doctor’s (Dr. Danylak) records and he asked to schedule a settlement meeting, though he had yet to produce any documents of substance regarding this loss. The timing of the request for a meeting is important and I will return to it.

[37] The issue of service on the defendant arose immediately thereafter. On August 21, 2008, Mr. Daly wrote to Lombard to advise that he was having difficulty serving the defendant at the Toronto address they had provided more than a year earlier. He wrote again on August 26, 2008, asking if they had a more current address.

[38] Later on the same day, August 26, 2008, Mr. Daly wrote to Lombard to state that it might make more sense for them to accept substitutional service.

[39] What follows is pivotal: somewhere between the August 26, 2008 letter and August 29, 2008, Mr. Daly spoke with the Lombard adjuster and obtained from him a Vancouver address for service on the defendant. This is clear from Mr. Daly’s confirming letter of the conversation, sent on the latter date.

Mr. Daly wrote:

o (in jest), if we cannot resolve the claim and we need to examine Mr. Ma you and I may need to fly to Whistler because I think there is a special examiner’s office there;

o Confirming the defendant’s address as 1232 Harbord St., Vancouver, V6E 1S2.

[40] Mr. Daly also sent along a list of 28 items received by his office from Dr. Danyluk, which were then produced.

[41] Thus, as of August 29, 2008 or perhaps even a bit earlier, Mr. Daly knew precisely where to find the defendant. For some unknown reason, however, Mr. Daly appears to have lost sight of the fact that he had this information.

[42] On September 12, 2008, Mr. Daly wrote to Lombard to again ask them to accept service. On September 29, 2008, Lombard advised that it was contrary to their policy to accept service. This is not uncommon – the court is often asked by plaintiffs for leave to serve defendants through their insurer as insurers rarely agree to such a request absent a court order. At that point, Mr. Daly ought to have arranged to serve or at least try to serve the claim at the Vancouver address he’d been given. There is absolutely no explanation in the Halls’ evidence as to why he took no steps in that direction after being handed the defendant’s address in 2008.

[43] On March 21, 2009, the Lombard file changed hands and the new adjuster, Ellie Logan, wrote to Mr. Daly, once again providing the Vancouver address for service. By this point, the claim had already expired so a motion to extend the time for service ought to have been brought. None was and there is no evidence from the Halls to explain why that was the case. As the time for service of a claim expires six months after it has been issued, and there is no notice from the court to alert counsel to this fact, I can and do infer that Mr. Daly either was or ought to have been aware that the time for service had already expired.

[44] In her March 2009 letter, Ms. Logan also pointed out that the insurer had received little in the way of documentation regarding this loss. The list of items sought included proof of income for the 52 weeks pre-accident; everything submitted to the AB insurer; any medical reports prepared and the clinical notes and records of all treating physicians. As it was now almost three years post loss, most of these items ought to have still been accessible. They should have been obtained and provided to the insurer.

[45] A further seven months passed and on October 6, 2009, Ms. Logan wrote to say that further to her voicemail messages of July 8, 2009 and her letter of March 21, 2009, Lombard could not accept service of the claim. The Vancouver address was provided for a third time. Mr. Daly had already been advised more than a year earlier that Lombard would not accept service and he was also told around that time precisely where to find the defendant, yet he persisted in taking no steps to extend the time for service or to the serve the claim, instead asking Lombard again to accept service.

[46] Ms. Logan’s letter of October 6, 2009 is critical – she wrote to say that if she did not hear from Mr. Daly within 30 days, she would assume the plaintiff was not proceeding with her claim and she would close her file. As the defendant had not been served, the claim had expired, and the plaintiff appeared to be taking no steps to extend the time for service, this was an entirely appropriate position for the insurer to have taken. Further, instead of simply closing their file, they put Mr. Daly on notice of their intention to do so. It was then up to him to get back to them.

[47] Lombard, however, heard nothing further. They heard nothing at all about this matter until Mr. Halpern took over the file – more than two and a half years later.

[48] Ing lists the documents that were and those that were not provided to Lombard/Northbridge. While they did receive Dr. Danylak’s (the family doctor) consultation records, it seems they were never provided with her clinical notes.

[49] Notices of assessment for the years 2003, 2004 and 2005 were provided, but none were served for the year of the loss and following. Some prescription summaries were also served. That marks the sum total of what was served during Mr. Daly’s carriage of the file, and all of that was sent in 2008. He provided no further documents though he had requested a settlement meeting in 2008.

[50] After Mr. Halpern took over the file in 2012, he sent along the clinical notes and records of Dr. Cohen, Dr. Munn and the Markham Stouffville Hospital, during July and August 2012.

[51] Ing states that the insurer has never been provided with a decoded OHIP summary, though one was requested at the very outset of their discussions with Mr. Daly. There is no evidence that this document was ever requested by either Mr. Daly or by the Halls’ current counsel. As OHIP’s retention schedule is only 7 years, any records on file sought now would only go back to the end of 2005, so for less than a year before the date of loss.

[52] This is an important point, as the clinical notes and records from Dr. Danylak contain a psychological assessment prepared by Dr. Munn, dated October 5, 2006. The report notes that in 1997, Hall paid for a learning disability assessment at the Listening Centre in Toronto because of issues she was having at that time. Dr. Munn states that Hall took a program at the Centre, which helped her with her reading difficulty significantly, as well as with analytical thinking and comprehension difficulties.

[53] According to Dr. Munn, Sarah Hall also described herself as anxious and it appears she had seen a counsellor on several occasions over a period of two years to help her with a relationship issue. All of this pre-dates the accident.

[54] Access to Hall’s pre-existing medical records could well shed more light on all of this, and a more complete OHIP summary would have assisted Hall in recalling who she had seen, when she had seen them and why. As the accident took place in 2006, even records requested in 2008, when Lombard first asked for them, would have gone back as far as 2001. That interim history is clearly relevant to the damages claimed in view of how the claim was pleaded, yet now it may become very difficult to reconstruct, as a valuable tool has been lost due to the passage of time. The plaintiffs say nothing about having even attempted to fill in the gaps.

[55] A further issue arises in the context of Dr. Cohen’s records. He indicates that that his office had attempted to contact Sarah Hall and her counsel to schedule approved treatments, but as they received no response, they closed their file on February 24, 2007. Dr. Cohen is a speech language pathologist. Again, the passage of time may make it difficult to piece together why this treatment was proposed and why it fell through the cracks.

[56] In terms of liability, the insurer took a statement from the defendant in November 2008. He indicated that another driver had waived him out into what turned out to be traffic. The police report lists three witnesses, any one of whom may have been this individual. Finding any of them now, all these years later, may be challenging. Finding them with intact memories of what they may have seen or done could be even more problematic. There is no evidence from the Halls that they have initiated a search for any of these people. The defendant, on the other hand, has retained a private investigator to make these efforts in this regard.

[57] As the accident resulted in the plaintiff’s vehicle flipping over, Ing states that the speed at which she was traveling will be a factor in assessing liability, so an engineering report may be needed. In order for the engineer to complete such a report, the property damage file would be required. The plaintiff’s evidence is silent as to whether it has been requested or if they have assured themselves that it still exists but the file was provided the day before the motion was argued, so it is no longer something that needs to be addressed.

[58] By e-mail of September 12, 2002, defence counsel specifically asked if the plaintiffs had managed to secure the decoded OHIP summary and if so, how far back. They also asked for the property damage documentation and plaintiff’s own Accident Benefits file. Though the motion was not heard until almost a full month later, no response was ever received and none of these issues is addressed in the Halls’ evidence (the property damage file was provided on the eve of this motion). There is an inference to be drawn from the lack of response coupled with the absence of any evidence to address these points.

[59] This motion cried out for reply evidence in so many areas. Once Ing filed his responding affidavit, it ought to have been clear to Mr. Halpern that his assumptions about why the claim was never served were nothing more than conjecture, not borne out by facts that have now emerged. If Mr. Halpern was unable to secure Mr. Daly’s cooperation to address this glaring omission, he ought to have filed evidence setting out precisely what he did and when in his efforts to engage Mr. Daly’s attention. As matters stand, there is no evidence at all to explain why there is no evidence from Mr. Daly on so many critical points.

[60] Then there is the issue of necessary documentation with respect to both damages and liability. There is no evidence that Mr. Halpern even began to address this issue after being served with Ing’s affidavit, nor is there evidence from him refuting Ing’s suggestion that these materials are important.

[61] All in all, the plaintiffs’ record leaves a lot unclear and a lot unsaid.

THE LAW

The Reid factors and the contextual approach

[62] The law in the area of setting aside administrative dismissal orders is now well settled as a result of four decisions that emerged from the Court of Appeal over the course of the last few years. These cases also make it clear that, though most deal with dismissals for delay (Rule 48.14(4)), the general principles articulated by the Court of Appeal have equal application to situations where the dismissal by the registrar is based on the action having been dismissed as abandoned (Rule 48.15(1)).

[63] The first case in the series is Scaini v. Prochnicki, 2007 ONCA 63, 85 O.R. (3d) 179. There, the court stated that although there are four main factors that should generally be considered when dealing with motions of this kind, the court’s approach should not be restricted to a rigid application of a test involving only the four elements set out in Reid v. Dow Corning Corp. [2001] O.J. No. 2365.

[64] Instead, a contextual approach is required. This involves a review of all relevant factors with the ultimate goal of balancing the respective interests of the parties to arrive at a just result. As the court stated:

The key point is that the court consider and weigh all relevant factors to determine the order that is just in the circumstances of the particular case.

[65] The four factors that emerge from Reid remain the starting point for the analysis. Those factors are as follows:

a. Explanation for delay in moving the action forward;

b. Inadvertence in having missed the deadline;

c. Promptness in bringing the motion to set aside the dismissal; and

d. No prejudice to the defendant if the dismissal order is set aside.

[66] It is also well-established that the plaintiff need not satisfy all four factors, as such an approach would undermine the balancing exercise that is required.

[67] The emphasis is on ultimately making the order “that is just” in the circumstances of each case. This is derived from Rule 48.15(5) which directs a party moving to set aside an order dismissing an action as abandoned to Rule 37.14. The latter Rule:

o requires the moving party to serve their notice of motion forthwith after the order comes to their attention; and

o allows the court to set aside or vary the order on such terms as are just.

[68] Marche D’alimentation Denis Theriault Ltee v. Giant Tiger Stores Ltd., 2007 ONCA 695, 87 O.R. (3d) 660 followed Scaini. There, the Court of Appeal confirmed the need to take a contextual approach. The court also discussed the impact of delay on how the civil justice system is perceived:

These rules and cases rest upon an important principle: there is a strong public interest in promoting the timely resolution of disputes. The notion that justice delayed is justice denied reaches back to the mists of time. For centuries, those working with our legal system have recognized that unnecessary delay strikes against the core values and have done everything within their power to combat it.

[69] In Finlay v. Van Passen, 2010 ONA 204, the Court of Appeal considered these motions in the context of counsel’s role, concluding that it is not helpful to suggest that a plaintiff will still have his day in court if a dismissal order is not set aside, as he can then pursue his own lawyer in negligence. The court cautioned against speculation regarding whether or not an action in negligence could be sustained, concluding that:

The court should be concerned primarily with the rights of the litigants, not the conduct of counsel.

[70] Of course, this presupposes that counsel’s conduct was not in accordance with instructions received from the client. It is critical to bear in mind that failure by counsel to take any steps to advance a case is not necessarily the result of his negligence or even inadvertence. It is also plausible that he was simply following instructions given or unable to obtain the instructions he needed to take the next step. That is why it is generally important to file evidence from the party, making it clear that it was their intention to move the action forward – that nothing they did or failed to do resulted in the case stalling. The importance of such evidence is elevated in a case like this one, where there is no evidence from counsel who had carriage of the case during the relevant time frame.

[71] Finally, in Wellwood v. OPP et al, 2010 ONCA 386, the Court of Appeal dealt head on with a motion to set aside a dismissal order made on the basis that the action appeared to have been abandoned, approaching the analysis on the same basis as a dismissal pursuant Rule 48.14(4).

[72] That case also reiterated what the court had already indicated regarding onus, in the context of discussing the 4 Reid factors:

...under the Ontario Rules for contemporary litigation, the party who commences the proceeding bears primary responsibility for its progress. For this reason, the initiating litigant generally suffers the consequences of a dilatory regard for the pace of litigation.

The role of prejudice and presumed prejudice

[73] The issue of prejudice – or lack thereof- has attracted considerable judicial comment in recent years.

[74] The first aspect for consideration is onus. As the overall onus on a motion to set aside an order is on the moving party, that onus includes, at least on a prima facie basis, showing that the defendant will suffer no prejudice if the dismissal order is set aside. If the plaintiff does that, the onus shifts to the defendant to show that prejudice would, indeed, ensue.

[75] In Wellwood, supra, the Court of Appeal held that, aside from the ordinary principles regarding onus, prejudice will be presumed where an action, though started within a limitation period, was dismissed after the limitation period had expired

[76] It is critical to note that cases that deal with the presumption of prejudice do not apply it with equal impact across the board. Here too, the Court of Appeal directs, context matters. This modulated approach is derived from Clairmonte v. Canadian Imperial Bank of Commerce, 1970 CanLII 470 (ON CA), [1970] 3 OR, 97, an earlier decision of the Court of Appeal relied on in Wellwood. There, the court held that the weight of the presumption varies with the length of the delay, as well as the nature of the action:

The force of the presumption...will depend on the time which has passed after the expiration of a limitation period as well as the nature of the action. While the presumptions will speak as a barely audible caution immediately after the limitation period has expired, it may command increasing imperativeness on the passage of a substantial time, depending on the cause of action.

[77] Care must therefore be taken when considering whether or not it is appropriate to apply the presumption of prejudice and, if so, how to apply it. The result of the presumption will not necessarily be uniform, but rather, will vary from case to case based on the two factors set out above: length of delay and nature of the action.

[78] The basis for this presumption of prejudice, in large part, flows from the recognition that the passage of time can impact on the availability and memories of necessary witnesses and on the accessibility of relevant documents. These concerns are relevant in the context of achieving fairness at trial. An action that has been administratively dismissed should not be reinstated if doing so would create an imbalance, such that the defendant can no longer expect a fair trial. As a result, both the length of delay and the nature of the action have a part to play on the effect of the presumption, on a case by case basis.

[79] When the presumption of prejudice does apply, the moving party has a positive onus to rebut it with evidence submitted to the court in proper form. The evidence should include reference to a number of elements, including, where applicable:

o whether all or most relevant documents have already been produced;

o the fact that relevant documents not yet produced have been sought and are, or likely, remain available;

o alternatively, that the case is not a “document case” so there is no need to be concerned about retention schedules;

o that key witnesses have been identified, are alive, and have been or can easily be located or that their evidence has been preserved in a manner which renders it usable at trial in a way that will not prejudice the defence;

o that these witnesses gave statements, evidence in some other form, or there are other documents they can refer to in order to refresh their memories in the event that a considerable period of time has passed since the events in issue;

o alternatively, the case will not turn on viva voce evidence but rather, on the documents, which are, for the most part, available;

o where the case involves a claim for personal injuries, the medical evidence describing and tracking the progress of pre-existing injuries/conditions is available, along with all medical evidence pertaining to the progress and possible recovery from the injuries complained of in the action;

o again, in claims arising from personal injuries, that the documents required to allow a defendant to explore a loss of income claimed by the plaintiff have been produced or remain accessible.

[80] If the moving party fails to make an attempt to rebut a presumption of prejudice where it applies, the defendant need not lead evidence of actual prejudice. If they do so, however, it will serve to further buttress the defence position. It is important to bear in mind that prejudice, though one of the 4 Reid factors to be balanced, has been recognized as a “key consideration” (see Marche d’alimentation, supra), so that its presence may well swing the balance against setting aside a dismissal order in appropriate cases. That is not to say that its absence automatically results in a motion of this kind being granted.

ANALYSIS and CONCLUSION

[81] The evidence that has been filed suggests that, though asked to obtain and provide certain documents early in the litigation, little of what was sought was ever provided by Mr. Daly.

[82] The evidence also demonstrates that, though provided with an address at which the defendant could be served in Vancouver on three occasions, former counsel with carriage failed to follow up and complete this step.

[83] There is no explanation from Mr. Daly as to why this occurred and no evidence from the Halls as to what they knew about any of it, or what efforts they made to find out why the action was not moving forward. There is also no evidence before the court to explain why this evidence is missing from the record.

[84] The fact that the Halls’ record is so sparse despite the fact that they are represented by counsel is troubling in the context of what they stand to lose on this motion. Although new counsel has taken some steps to move the action forward,by providing the defendant with what he now appears to have on file, serious gaps remain and there is no evidence that this information has been sought, that it remains available and that it can be obtained.

[85] Turning to the analysis, a good place to start is with the 4 Reid factors, adapted to apply in a Rule 48.14(4) scenario.

[86] Explanation for the delay in proceeding with the action: The onus is on the plaintiff to provide a satisfactory explanation for the delay from the commencement of the action until it has been dismissed. They must either demonstrate that steps were taken to move the action forward or explain why that was not the case.

[87] The first step after issuance of a claim is usually service. This action was started in May 2008. By August of that year, before the time for service of the claim had expired, Mr. Daly was provided with the defendant’s Vancouver address for service. He was given the same address again in March 2009 and a third time in October 2009.

[88] Only one attempt was made to serve the defendant, back in June 2008, at an earlier address in Toronto, provided by the defendant at the time of the accident and also provided by the insurer.

[89] Having been provided with the new Vancouver address, however, instead of taking steps to serve the defendant there, Mr. Daly tried to take a short cut. He asked the insurer to accept service, which they quickly declined to do. They said “no” in September 2008, during the life of the claim, again in July and, finally, in October 2009. This is their undisputed evidence. There can therefore be no doubt that the insurer made it clear they were not prepared to accept service so that steps had to be taken to serve the defendant.

[90] There is no evidence as to anything Mr. Daly did or tried to do regarding service. There is no evidence to suggest he tried to have the defendant served in Vancouver and no evidence to indicate that Mr. Daly even retained a process served in B.C. to initiate this process. There is no reference in the Case History to a motion for leave for substitional service on the defendant having been scheduled and no evidence that materials to that end were found in the file when Mr. Halpern took over carriage of the action.

[91] In fact, service of the claim – the essential first step that engages the defendant in the law suit –does not appear to have ever happened or to have ever been attempted at the Vancouver address.

[92] There is no evidence from Mr. Daly explaining why this is the case. There is also no evidence from any of the Halls indicating what inquiries they were making during this time about the progress of the action or setting out what they may have been told by Mr. Daly in that regard. The record is silent.

[93] Mr. Halpern tried to deal with the gap by speculating as to why the claim was never served. However, Ing’s actual evidence, based on letters found in the insurers’ file, totally negates Mr. Halpern’s speculative theory. There is no reply affidavit from Mr. Halpern to add to what he had said earlier. As a result, Ing’s evidence stands unchallenged.

[94] There is no credible evidence as to why the claim was not served, while there is evidence that Mr. Daly knew precisely where to find the defendant and that he was reminded of that at least twice after he was first told. It was the failure to complete this step that stalled the action and led to its demise.

[95] In the context of those facts, I am unable to say that there is any explanation as to what steps the plaintiff was taking during this time span. There is also no satisfactory explanation supported by evidence explaining the delay in moving this action forward.

[96] Further, these is no evidence from either Mr. Daly or the Halls to supplement Mr. Halpern’s conjecture and there is nothing from Mr. Halpern explaining why that is the case. On a motion of this kind, it is not sufficient for counsel to simply stand up and tell the court that efforts to engage Mr. Daly were not successful. Instead, there should have been an affidavit from the staff at Mr. Halpern’s firm who tried to reach Mr. Daly by phone, fax or e-mail, indicating the efforts that were made, when they were made and the results. Had this evidence been filed and had it been satisfactory, it may have been of assistance here if all of the other factors worked together with this one to create a balance in the plaintiffs’ favour.

[97] Although far too common these days, this is not a run of the mill motion that is automatically granted, and it should never be treated as if it were, particularly when opposed. It is the lack of evidence from the key players – Mr. Daly and the Halls – coupled with the lack of reply evidence that is particularly troubling in this case.

[98] I am unable to conclude that proper steps were taken to keep the action moving forward and I have been given no credible explanation, let alone a satisfactory one, for why that is the case. I therefore find the delay to be inexcusable, a factor to be considered with the others.

Inadvertence in missing the deadline for compliance with Rule 48.15(1)

[99] Pursuant to Rule 48.15(1) the plaintiff must take steps within 180 days of issuing process to ensure that the action is on track. If no defence has been delivered, and the failure to defend is not the result of a pending motion to challenge jurisdiction, the plaintiff must note the defendant in default and move for judgment.

[100] Keeping track of this time frame is not difficult- the 180 day period runs in a straight line from the date on which the claim was issued. There is no formula to apply, no calculations to make. All that is required is to simply record the date the claim was issued and select a “bring forward” date sufficiently in advance of the deadline to allow for time to either note a defendant who has been served in default and to move for judgment or to seek an extension of the deadline for service.

[101] In this case, as the defendant had not been served, the onus was on Mr. Daly to seek an order extending the time to serve the claim retroactively and extending the time for compliance with Rule 48.15(1). That simple step would have given him additional time to serve the defendant in Vancouver.

[102] Of course, this presupposes that Mr. Daly was instructed to serve the claim and to move to extend the deadline for service. There is no evidence from any of the Halls to the effect that he was. It is therefore unclear, at this point, if this is a case about a lawyer who failed to take steps or clients who instructed him not to do so or failed to instruct him at all, bearing in mind that Sarah moved to the US while Mr. Daly was still handling the file.

[103] There is also evidence that Sarah suffered from some form of learning disability before the accident occurred. It therefore cannot be assumed that nothing happened here solely because of Mr. Daly’s inattention to the file. It is possible that the plaintiffs, themselves, had a role to play in the inaction.. In either case, in view of the lack of evidence regarding what transpired, the results are the same.

[104] There is no evidence as to why the deadline was missed, and no evidence as to why nothing was done to extend the deadline. Clearly, this factor works against the Halls’ position on this motion so it is yet a further factor to be considered in the balance.

Did the plaintiff move with dispatch to schedule a motion to set the dismissal aside?

[105] Again, this issue is problematic for the plaintiffs. The action was dismissed as abandoned in July 2010. This motion was not brought until June 2012, almost 2 years later and not heard until October 2012.

[106] The only explanation that Mr. Halpern offers for the delay in moving is the fact that his firm was only retained on December 2011 and he only learned of the dismissal on December 20, 2012. His explanation for the delay covers only his part of it – he asked for but did not receive the file from Mr. Daly until February 14, 2012 – and then, he received it minus the correspondence.

[107] Mr. Halpern cannot nor did he try to address the delay at Mr. Daly’s end. There is no evidence from Mr. Halpern stating that he did or did not find a copy of the dismissal notice from the court in the file materials he received from Mr. Daly and no evidence from Mr. Daly claiming he failed to receive the notice. I am not prepared to assume that the notice when astray without evidence of some kind addressing the issue.

[108] There is also no evidence from the Halls indicating what they knew about this dismissal and whether they gave instructions to proceed with this motion.

[109] In view of the absence of evidence on this point, I am unable to conclude that the Halls moved with dispatch to set aside the dismissal.

Prejudice

[110] The context within which this motion arises is an accident that occurred on May 13, 2006. The statement of claim was issued on May 12, 2008, on the eve of the expiry of the two-year limitation period. It is now 2012, 6 ½ years since the date of loss, and no steps at all have been taken to advance this claim. There has been no documentary or oral discovery and no mediation. The statement of claim has yet to be served and a defence to be delivered. Aside from a handful of documents produced, we are essentially at the starting gate for this action. An optimistic estimate suggests that if the dismissal order were to be set aside, it would be a further two years before the action was ready to proceed to trial.

[111] Trying an action in November 2014 that was started in May 2008, based on events that occurred in 2006, does, unfortunately, happen from time to time. This time-line is most often seen in cases involving multiple parties and counsel, as well as complex factual and/or legal issues. We see this when a party or counsel has died or becomes severely ill and is not able to proceed for a period of time. We also see it when appeals are taken from interim orders. This action does not fall into any of those categories. There is no apparent reason for this action to have been delayed to this extent.

[112] This action involves what appears to have been a straightforward claim for injuries arising from a motor vehicle accident. I say it was relatively straightforward claim as Mr. Daly was looking for a settlement meeting with the insurer very early on. On August 18, 2008, only three months after the claim was issued and barely two years after the injuries were sustained, Mr. Daly was of the view the action was ready to be settled, and he sought dates for a meeting with the insurer to that end.

[113] Mr. Daly also appears to have been reluctant to spend money on advancing this claim – his repeated efforts to get the insurer to accept service rather than having to pay for a process server in Vancouver is one example of how he tried to keep the costs down. Another was his reluctance to order the documents sought by the insurer at the outset, to enable them assess whether the claim met the threshold. Instead of providing what was requested, Mr. Daly deferred the request, saying he would do as asked “in the fullness of time”. That point never seems to have arrived.

[114] Based on the evidence derived mostly from the insurer’s file, I infer that Mr. Daly was looking for a quick settlement without having to invest too much time or money in the file because he appeared to view it as a relatively straightforward matter.

[115] This is a personal injury action - whether or not the claim meets threshold; an accurate list of the injuries sustained in the accident; the progress of those injuries and when each reached a plateau; the income allegedly lost as a result of injuries sustained – are all issues that will have to be addressed in the context of dealing with damages. To some extent, this is generally done with documents, as well as through the viva voce evidence of the injured plaintiff, those close to her and her physicians.

[116] In terms of the necessary viva voce evidence, cross examination is a critical part of the process. If the plaintiff or her witnesses stumble in their evidence, the passage of time should not be available as justification for failing memories, particularly when the delay has been caused by that plaintiff. This diminishes the strength of an effective cross-examination designed to bring out inconsistencies in the evidence.

[117] Further, having access to the flow of documents over time facilitates a defendant’s ability to challenge the plaintiff’s evidence by pointing out inconsistencies in the story. If documents pre-dating the accident are no longer available, this can work a hardship on a defendant trying to establish that the plaintiff’s current physical, mental or emotional state is the result of a pre-existing condition and not causally related to the accident.

[118] Liability is also in issue here. The details of the moments leading up to the accident, who was where and traveling at what speed, and why the collision occurred, from the perspective of all parties and potential witnesses, becomes harder and harder to reconstruct as time passes and memories fade.

[119] Accordingly, taking into account the extent of the delay and the nature of the action, I conclude that it is appropriate to impose a presumption of prejudice in this case. Having done so, the onus is now on the plaintiff is to provide positive evidence to refute the presumption.

[120] The insurer has also raised several areas of actual potential prejudice, which strengthens their position on this motion. With respect to the issue of damages, the insurer points out their access to OHIP records for the period preceding this accident is now limited. In view of other evidence suggesting that the plaintiff suffered from and was treated for anxiety and had difficulties with reading into adulthood, these earlier records could have a bearing on her present state, and therefore useful to the insurer in dealing with claims that includes compensation for “physical, psychological and mental injuries” and impairment of Hall’s “ability to perform normal cognitive and memory functions”.

[121] Further, as the insurer closed its file, after having advised Mr. Daly that they would do in the fall of 2009, they lost the opportunity to conduct surveillance of the plaintiff over the course of the last three years. It was, in my view, perfectly reasonable for them to have closed the file as the claim was never served, though they made it clear where service could be affected and provided notice of their intention to close the file in advance.

[122] On the basis of damages, alone, I have serious doubts as to whether the defendant can now get a fair trial.

[123] Similarly, with respect to liability, there is no evidence from the Halls to suggest that they have located or even tried to find the witnesses listed on the police report or that they have ever located them and taken statements from them. The plaintiff’s theory of the case is that he was waved into what turned out to be oncoming traffic so what these witnesses saw could be pivotal. It is the insurer who is now looking for them. The onus of demonstrating their availability, however, was on the Halls.

[124] Thus, with respect to the issue of liability, there are also reasons to be concerned about whether the defendant can now obtain a fair trial.

[125] I am therefore satisfied that the presumption of prejudice created here by the expiry of the applicable limitation period has not been rebutted. Moreover, there is evidence of real prejudice that cannot be overlooked and towards which the Halls have directed no evidence.

Other relevant factors

[126] The Court of Appeal has repeatedly stated that a contextual approach is needed and that consideration of motions of this kind ought not to be restricted to the 4 Reid factors.

[127] There are two other potentially relevant factors here. The first is that the Halls changed counsel. They did not do so, however, until December 2011. There is no evidence from them indicating:

o why they chose to do this;

o whether this was their call or Mr. Daly’s;

o why they opted to do it then;

o whether they tried to contact Mr. Daly;

o if they were able to make contact with him;

o if they called him regularly and if so, when;

o if they badgered him to get on with it;

o if they were told everything was in hand;

o if they were told that the action was dismissed as abandoned. Hearsay evidence from counsel on this point carries little weight;

o if Mr. Daly simply ignored their calls and letters.

[128] The lack of evidence on these points is troubling. Case law is clear and the law well established, in terms of the kinds of things the court will look for when asked to grant this relief. When the evidence is missing, the court can and should draw inferences that there is nothing further that is helpful to the party that is available. I do so here.

[129] It is also troubling that, in the absence of an affidavit from Mr. Daly, there is no affidavit from Mr. Halpern explaining why that is the case. I should not simply be told in court that he was hard or even impossible to get a hold of. A court can only find facts from among those presented in proper form. At the very least, there ought to have been evidence about efforts made to contact Mr. Daly; about sending him the responding record for comment; about further efforts to get his input after the Ing affidavit was filed. None of this was before the court.

[130] The other issue that should not be overlooked is how helpful the insurer was throughout. First, they provided an address for service in Toronto. Then, they provided what is likely the correct address for service of the defendant in Vancouver –something they did three times.

[131] The insurer also provided notice to Mr. Daly that they planned to close their file before they did so, and they eventually did so in appropriate circumstances. They should not be prejudiced after having made the effort to assist these plaintiffs in serving their claim. This is not an insurer who can be accused of “lying in the weeds”, waiting for the action to be dismissed. They actively pursued documents and provided helpful information, while doing nothing to resist efforts by the plaintiff to move the action forward. If anything, this defendant tried to spur the Halls into action by advising of their plans to close their file if nothing further happened. There is no aspect of their conduct with which fault can be found (see 1196158 Ontario Inc. v. 6274013 Canada Limited et al., 2012 ONCA 544, 112 OR (3d) 67).

[132] On the totality of the evidence, I have concluded that the Halls have failed to meet any aspect of their burden on this motion. That leaves little in the way of a balancing act to perform. Furthermore, prejudice, the key component, favours the defendants.

[133] The motion is therefore dismissed.

COSTS

[134] On consent, costs payable to the responding party and fixed at $2964, payable within 30 days.

Master Joan M. Haberman

Released: November 27, 2012