COURT FILE NO.: CV-12-1329

DATE: 20130220

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Resort Country Realty Inc. Plaintiff (Responding Party)

AND:

Tanglewood (Sierra Homes) Inc., Defendant (Moving Party)

BEFORE: M. P. EBERHARD

COUNSEL:
J. Murphy, Counsel, for the Plaintiff
M. Simaan, Counsel, for the Defendant

HEARD: February 19, 2013

ENDORSEMENT

[1] The Respondent moves for leave to appeal the order of McCarthy J. dated October 3, 2012 which granted the Plaintiff’s motion to consolidate and transfer Small Claims Court actions to the Superior Court of Justice and which dismissed the Defendant’s motion to strike the claims for abuse of process.

[2] There is an adjourned motion, not before me or before McCarthy J., brought by the Plaintiff to set aside the disputed consent dismissal of a Superior Court of Justice (10-1180) claim for payment of commissions and counterclaim for defamation involving the same parties and same issues which is either moot as a result of McCarthy J.’s order or, as argued by the Moving Party before me, the proper alternative course which should be taken such that the Danyluk[^1] factors, addressed hereafter, should not be applied in the manner McCarthy J. did.

[3] Parenthetically, there is still a Toronto action for defamation with the same claim as advanced in the subject counterclaim.

[4] It is conceded that but for the issues arising from the earlier proceeding in the Superior Court of Justice the consolidation and transfer of the several Small Claims Court actions to this court would be proper.

[5] There is no disagreement on the tests under rule 62.02(4) on the basis of either conflicting decisions and desirable that leave be granted; or good reason to doubt the correctness and the matter is of such importance that leave should be granted.

[6] I am not persuaded on either ground that leave should be granted.

[7] Neither party contests the summary of facts by McCarthy J. in his ruling.

[8] The Moving Party argues that the consent dismissal is a final order and the issues therein are res judicata. He relies on Durbano[^2] as Court of Appeal authority for the proposition. He predicts that the present case will remove an important distinction between discontinuance and a negotiated consent dismissal thereby compromising the finality of all such consent dismissals and opening the gates to floods of litigation.

[9] The Moving Party argues that the relief granted by McCarthy J. allows the Plaintiff to circumvent the tests under rule 59 for setting aside a judgment. The Moving Party argues that the circumstance in Danyluk that the claimant had no recourse by appeal is crucial to the Supreme Court of Canada exercise of discretion not to find that her issues were finalized on the basis of res judicata. Here, the Plaintiff could still persuade the next Motions Judge that the consent order should be set aside and revive the 10-1180 action.

[10] There is also dispute as to the extent of the Plaintiff’s legal advice as he began the process of filing claims in the Small Claims Court and eventually seeking discontinuation of the Superior Court of Justice claim which included them all. There is no dispute that the Plaintiff’s counsel of record in the Superior Court of Justice claim did sign the consent to dismiss the claim and counterclaim. If Durbano stands for the principle that all consent dismissal orders are final and res judicata of the issues therein then the actions of his counsel provide yet another recourse for the Plaintiff.

[11] I find the Durbano decision on the facts indicated therein is not in conflict with the McCarthy ruling. That Plaintiff sought to start a new claim on issues found to have already been put to rest by the consent dismissal. Classic res judicata. In the present case there were co-existing claims in three courts. The consent dismissal was silent as to these other cases. The correspondence referred to discontinuance, then dismissal, of the case in the Superior Court of Justice and the consent and resulting order referred to it by number. No one, not either lawyer, chose to be specific about the co-existing cases.

[12] In Danyluk there was a final order. That demonstrates already that there are some limited circumstances where finality will give way to other factors. McCarthy J. had a discretion that he applied for the reasons given. I did not find reason to doubt the correctness of his decision.

[13] There is no prejudice that cannot be remedied by applying the same principles to bring the counterclaim back before the court or by costs for the steps generated by the plaintiff blundering into the Small Claims Court.

[14] Absent the order of McCarthy J. there would persist a sense that the blunders of the Plaintiff, at the pleadings stage, are being taken advantage of to prevent the merits of the claim being heard. I was drawn, as was McCarthy J., to the observation in the Supreme Court of Canada in Danyluk that “Whatever the appellant’s various procedural mistakes in this case, the stubborn fact remains that her claim to commissions has simply never been properly considered and adjudicated”.

[15] I am not driven to grant leave by fear of the floodgates opening. These are very particular circumstances.

[16] The motion is dismissed.

[17] If the parties cannot agree, the Plaintiff may seek costs by 2 pages in writing and a Bill of Costs delivered to the judicial secretary in Barrie in wring by March 1, the Defendant a 2 page response by March 8 and similar reply by March 12, all in 2013.

EBERHARD J.

Date: February 20, 2013

[^1]: Danyluk v. Ainsworth Technologies Inc. 2001 SCC 44

[^2]: 1153238 Ontario Ltd v Durbano 2002CarswellOnt 1010 (C.A.)