SUPERIOR COURT OF JUSTICE - ONTARIO

COURT FILE NO.: CV-11-00438655-0000
DATE: 20120813

RE: Bank of Nova Scotia

and

Technoplast Packaging Inc. and Kristin Gudmundsdottir

BEFORE: Justice E.M. Morgan

COUNSEL:
Max Khan, for the Plaintiff

Robyrt Regan, for the Defendant

DATE HEARD: August 13, 2012

E N D O R S E M E N T

[ 1 ] Two motions are before me: a motion by the Defendants to set aside the default judgment against them and to permit them to file a Statement of Defense, and a motion by the Plaintiff to find the Defendants in contempt of court for the breach of several orders of this court (including failure by a representative of the corporate Defendant to attend at an examination in aid of execution, failure by the personal Defendant to attend at an examination in aid of execution with the required documents, and various delays in responding to matters in the litigation process).

[ 2 ] The Defendants have placed the blame for their conduct of the litigation squarely on their former solicitor and his assistant, a disbarred lawyer. The Plaintiff argues that at some point parties have to take responsibility for their own conduct and cannot blame their lawyers for their own failure to adhere to court orders and to respond properly to court processes.

[ 3 ] While I would generally agree with counsel for the Plaintiff that parties must take ownership of their own actions, the failures of the Defendants that give rise to the contempt motion are all specific to the litigation context. This is precisely the context in which one can expect to rely upon a lawyer’s guidance. The Defendants’ former lawyer, Mr. Weisdorf, was present at the examinations in issue and was solicitor of record during the time period that is the subject matter of the contempt motion.

[ 4 ] Given the allegations made by the Defendants that they were ill-advised, there is sufficient doubt as to the Defendants’ intentions that I cannot find them in contempt. I do understand why the Plaintiff brought the contempt motion, as from the outside the Defendants appear to have disregarded court orders and procedures in a cavalier way. However, the fact is that the Defendants were until recently represented by a disbarred lawyer, Mr. Barda, working in conjunction with Mr. Weisdorf who, according to the Defendants’ new lawyer, Mr. Regan, has been so non-responsive that he has not yet transferred the file despite several requests and notice of today’s motion. In light of that evidence, onus of proof for contempt of court, and in particular the culpable intent that must accompany such a finding, has not been made out.

[ 5 ] Given the course of conduct that the Defendants have engaged in and that the Plaintiff has had to bear, the Defendants will not have their costs of the contempt motion despite being the successful party in that motion. There will be no costs of the contempt motion for or against either side.

[ 6 ] I am reserving judgment on the Defendants’ motion to set aside the default judgment and to file a Statement of Defense, and will provide my ruling in that motion in a supplementary endorsement in due course.

Morgan J.

DATE: August 13, 2012