ONTARIO
SUPERIOR COURT OF JUSTICE
COURT FILE NO.: 11-CV-424069CP
DATE: March 11, 2013
BETWEEN:
TRUSTEES OF THE MILLWRIGHT REGIONAL COUNCIL OF ONTARIO PENSION TRUST FUND
Plaintiffs
– and –
CELESTICA INC., STEPHEN W. DELANEY and ANTHONY P. PUPPI
Defendants
AND BETWEEN:
NABIL BERZI
Plaintiff
– and –
CELESTICA INC., STEPHEN W. DELANEY and ANTHONY P. PUPPI
Defendants
AND BETWEEN:
HUACHENG XING
Plaintiff
– and –
CELESTICA INC., STEPHEN W. DELANEY and ANTHONY P. PUPPI
Defendants
Celeste Poltak and Jonathan Bida for the Plaintiffs
Nigel Campbell and Ryan A. Morris
for the Defendants
Proceeding under the Class Proceedings Act, 1992
HEARD: March 11, 2013
Perell, J.
REASONS FOR DECISION
A. Introduction
[1] This is a motion pursuant to Rule 59.06(1) of the Rules of Civil Procedure to vary or amend an Order dated October 15, 2012 that I made on a motion under Rule 21, which motion also served as part of a bifurcated motion to certify this action under the Class Proceedings Act, 1992, S.O. 1992, c. 6. (See Trustees of the Millwright Regional Council of Ontario Pension Trust Fund v. Celestica Inc., 2012 ONSC 6083.) I will sometimes refer to this motion as the hybrid motion.
[2] To be more precise about the background, after the Plaintiffs, Huacheng Xing, Nabil Berzi, and the Trustees of the Millwright Regional Council of Ontario Pension Trust Fund (the “Trustees”) commenced three proposed class actions, the Defendants, Celestica Inc., Stephen W. Delaney, and Anthony P. Puppi brought a motion under Rule 21 to have the Plaintiffs’ consolidated action dismissed. I allowed the Rule 21 motion to be heard before the certification motion on the condition that the Rule 21 motion would be dispositive of the cause of action criterion of the test for certification (s. 5(1)(a) of the Class Proceedings Act).
[3] The Defendants now seek an order amending the October 15 Order, which order has already been issued and entered.
[4] On the hybrid motion, among various attacks on the Plaintiffs’ Statement of Claim, the Defendants submitted that it was plain and obvious that the Plaintiffs’ claim under Part XXIII.1 of the Ontario Securities Act, R.S.O. 1990, c. S. 5 was statute-barred because it was too late to obtain the leave of the court that is required to assert a claim under Part XXIII.1 of the Act.
[5] On the hybrid motion, I did not agree with this submission, and I dismissed the Defendants’ Rule 21 motion. Although it was clear that the limitation period had run its course, I concluded that leave could be granted nunc pro tunc because of the special circumstances doctrine. I also concluded that the Plaintiffs had satisfied the cause of action criterion of the test for certification.
[6] The Defendants now seek an order to add the following term to the issued and entered October 15 Order:
THIS COURT ORDERS that, if the Court grants the Plaintiffs leave to proceed under section 138.8 of the Securities Act, R.S.O. 1990, c. S. 5, as amended (the “OSA”), there are special circumstances justifying an order granting leave nunc pro tunc, despite the expiry of the limitation period under section 138.14 of the OSA.
[7] The Plaintiffs submit, however, that the Defendants’ request to amend the October 15 Order is unnecessary, premature, and redundant. Further, the Plaintiffs submit that the Defendants` motion is an attempt to obtain a procedural advantage on a pending motion before the Court of Appeal; i.e. the Plaintiffs have an outstanding motion to quash the Defendants’ appeal to the Court of Appeal of the October 15 Order on the grounds that the order is interlocutory and not final as required for an appeal to the Court of Appeal, and the Plaintiffs say that the Defendants’ motion to amend is really a means to overcome the Plaintiff’s motion to quash.
[8] For the reasons that follow, I grant the Defendants` motion.
B. Factual and Procedural Background
[9] With some observations and comments that will be pertinent to the discussion section that follows, the factual and procedural background to this Rule 59.06(1) motion is as follows.
[10] In three proposed class actions under the Class Proceedings Act, 1992, which have been consolidated, Messrs. Xing and Berzi and the Trustees sue Celestica and Messrs. Delaney and Puppi.
[11] The Plaintiffs’ main allegation is that from January 27, 2005 to January 30, 2007, Celestica and Messrs. Delaney and Puppi misrepresented in the secondary market the progress of Celestica’s restructuring of its operations in North America. There is a three-year limitation period for this type of claim under Part XXIII.1 of the Ontario Securities Act, R.S.O. 1990, c. S.5.
[12] Pursuant to Rules 21.01(1)(a), 21.01(1)(b), 25.06, and 25.11 of the Rules of Civil Procedure, the Defendants made a motion to strike portions of the Plaintiffs’ Fresh as Amended Statement of Claim. Pursuant to this court’s order of April 13, 2012, this motion was also to determine the cause of action criterion of the test for certification under the Class Proceedings Act, 1992, s. 5 (1)(a).
[13] The Defendants` hybrid motion was not meant to decide whether the other criteria for certification were satisfied. The balance of the certification motion and the leave motion under the Ontario Securities Act are scheduled for December 9, 10, 11, 12 and 13, 2013.
[14] The Defendants’ hybrid motion raised the question of whether this court has jurisdiction to relieve against the limitation period imposed by s. 138.14 of Part XXIII.1 of the Ontario Securities Act. On the hybrid motion, the Defendants argued that it was plain and obvious that limitation periods barred the Part XXIII.1 claims and that the special circumstances doctrine was unavailable to relieve against the limitation period for Part XXIII.1 claims.
[15] As already noted above, I disagreed. It was and is my opinion, that the Plaintiffs’ Part XXIII.1 claim was statute-barred, unless the special circumstances doctrine was available as a matter of law and as a matter of fact. It was my opinion that: (a) as a matter of interpretation of the Limitations Act, 2002, S.O. 2002, c. 24, sched. B, that the special circumstances doctrine was available to claims that otherwise would be statute-barred under the Ontario Securities Act; and (2) in the case at bar, as a matter of pleaded fact, the special circumstances doctrine applied. I meant my Reasons for Decision to reflect those opinions.
[16] It was my intention to make it clear to the parties that on the subsequent completion of the certification motion, which was to be combined with the motion for leave under the Ontario Securities Act ,that in the event that I granted leave, then I would make the order nunc pro tunc.
[17] Pausing here, I make four observations. First, there was no dispute, nor could there be any dispute about the circumstances that led to the debate about the application of the special circumstances doctrine. Namely, the circumstances were that all the parties were taken by surprise by the Court of Appeal’s decision in in Sharma v. Timminco Ltd., 2012 ONCA 107, reversing 2011 ONSC 8024, leave to appeal to the S.C.C. refused, [2012] S.C.C.A. No. 157. Second, my ruling about the special circumstance doctrine is not expressed in the October 15 Order. Third, I think this omission was a mistake because I meant my conclusions about the special circumstances doctrine to be part of any Order. Fourth, whether the inclusion of the missing term effects the designation of the October 15 Order as interlocutory or final is not for me to say; in the case at bar, it will be for the appellate court on the motion to quash to decide how to characterize the October 15 Order.
[18] Returning to the factual and procedural background, following the release of my Reasons for Decision, the Defendants drafted the order and the parties spent several weeks negotiating the terms of the Order. The substance of the order that was issued and entered is as follows:
THIS MOTION, made by the Defendants for an order striking certain claims in the Fresh As Amended Statement of Claim, was heard on October 3 and 4, 2012 at Osgoode Hall, 130 Queen Street West, Toronto.
THIS COURT ORDERS that the Plaintiffs’ pleading of negligent misrepresentation be struck in its entirety, with leave to amend.
THIS COURT ORDERS that the proposed Class definition be amended to: …
THIS COURT ORDERS that the Plaintiffs’ pleading of the follow statutes be struck in its entirety, without leave to amend: (a) Part 16.1 of the Securities Act, R.S.B.C., c. 418 [and the other statutory claims provisions for jurisdictions other than Ontario].
THIS COURT ORDERS that the Plaintiffs’ pleadings of fraudulent concealment, mistake, waiver and estoppel are struck without leave to amend.
THIS COURT ORDERS that the balance of the Defendants’ motion be and is hereby dismissed.
[19] As appears, the October 15 Order does not address the special circumstances issue. Nevertheless, I signed the order as drafted by the parties.
[20] On October 23, 2012, the Defendants served a notice of motion for leave to appeal to the Divisional Court.
[21] On November 13, 2012, the Defendants served a notice of appeal to the Court of Appeal.
[22] The Defendants’ rationale for proceeding with two possible appeals was that the Defendants believed that the October 15 Order with respect to the limitation period issue was a final order appealable to the Court of Appeal, but other parts of the October 15 Order were interlocutory or the Defendants believed that if the limitation issue was also interlocutory, then the Defendants needed leave to appeal to the Divisional Court, pursuant to sections 6(2) and 6(3) of the Courts of Justice Act, R.S.O. 1990, c. C.43, as amended.
[23] On December 19, 2012, the Defendants proceeded with the hearing of their motion for leave to appeal to the Divisional Court.
[24] The Plaintiffs opposed the motion for leave to appeal and submitted that it was not desirable to grant leave to appeal because: (i) the motions judge had only determined that it was not plain and obvious that certain claims would fail; (ii) these claims may proceed to be adjudicated upon at the statutory leave motion pursuant to the Securities Act and at trial; and, (iii) the Defendants’ ability to raise the same arguments and defences had been preserved.
[25] On December 24, 2012, Justice Aston denied leave to appeal. He held that the Defendants remained entitled to assert that the Part XXIII.1 claim was statute-barred. He concluded that all that had been decided on the hybrid motion was that the claims were not certain to fail and may proceed to the next stage and that “any appeal [of Rule 21] ought to be packaged with an appeal of an order granting leave under the OSA and/or an order certifying a class proceeding”.
[26] I pause again, this time to make three more comments. First, I do understand why the Plaintiffs would wish to argue that the Defendants are free to assert that the Part XXIII.1 claim is statute-barred, which is to negate a conclusion that is so helpful to the Plaintiffs. I would have thought that they would be delighted to have this issue resolved in their favour without having to be re-litigated.
[27] Second, although I understand how based on the order that was issued and entered, he reached his conclusion, I disagree with Justice Aston’s conclusion that the limitation period defence would be available to the Defendants after the hybrid motion. That is not what I decided, although the October 15 Order does not reflect this decision. I make no comment about Justice Aston’s other reasons for refusing leave to appeal.
[28] Third, assuming that later this year, the Plaintiffs satisfy the test for leave to assert a claim under Part XXIII.1 of the Ontario Securities Act (which is an issue that will be determined at the hearing in December 2013), I have already decided that I can grant leave nunc pro tunc, in which case, the Defendants’ limitation period defence would not be available.
C. Discussion
[29] Rule 59.06 (1) provides for the amendment of an order that contains an error. The rule states:
59.06 (1) An order that contains an error arising from an accidental slip or omission or requires amendments in any particular on which the court did no adjudicate may be amended on a motion in the proceeding.
[30] Rule 59.06 (1) is designed to amend judgments containing a slip or error, errors which are clerical, mathematical or due to misadventure or oversight. The rule is designed to amend judgments containing a slip, not to set aside judgments resulting from a slip in judicial reasoning: Central Canada Travel Services v. Bank of Montreal, 1986 2576 (ON SC), [1986] O.J. No. 1249 at para. 21 (H.C.J.); Dhaliwal v. Plantus, [2007] O.J. No. 5450 at para. 4 (S.C.J.). Rule 59.06 (1) is not designed to be a disguised means to review errors in the making of the Reasons for Decision; rather, it is designed to correct errors in memorializing the Reasons into a formal order or judgment.
[31] Generally speaking the court’s inherent and statutory jurisdiction to amend an order or judgment is limited to: (1) cases of fraud; (2) where there has been a slip in drawing up the order; and (3) where there has been an error in the order expressing the manifest intention of the court from its reasons for decision: Paper Machinery Limited v. J.O. Ross Engineering Corp., 1934 1 (SCC), [1934] S.C.R. 186; Re Wright, [1949] O.J. No. 3 (H.C.J.); Millard v. North George Capital Management Ltd., [1999] O.J. No. 3957 (S.C.J.). The rule is only operative in exceptional circumstances given the public interest in the principle of finality to the litigation process: Shaw Satellite G.P. v. Pieckenhagen, 2011 ONSC 5968 (S.C.J.) at para. 20.
[32] Under rule 59.06(1), the Court has the power to amend an order where there has been an error in expressing the manifest intention of the Court: Paper Machinery Limited. v. J.O. Ross Engineering Corporation, 1934 1 (SCC), [1934] S.C.R. 186; Millard v. North George Capital Management Ltd., [1999] O.J. No. 3957 (S.C.J.); Convay v. Marsulex, [2004] O.J. No. 3645 (S.C.J.).
[33] The rule permits amendments where the order obviously or indubitably does not reflect what the court intended to do, either by error or oversight: Johnston v. Johnston, [2002] O.J. No. 1570 (Div. Ct.); Saikely v. 519579 Ontario Ltd., [2002] O.J. No. 2863 (S.C.J.); Kerr v. Danier Leather Inc., (2005) 2005 23095 (ON SC), 76 O.R. (3d) 354 (S.C.J.).
[34] In Chrysler Credit Canada Ltd. v. 734925 Ontario Ltd., [1991] O.J. No. 3619 (Master), Master Peppiatt stated at para. 10.
- The purpose of…[the] procedure [under Rule 59] is to ensure, so far as humanly possible, that the formal order upon which an appellate court, and other members of the same court, sheriff, accountant, etc., will act accurately sets out the intention of the court which pronounced the order as reflected in the endorsement or reasons. It is important that this should be done so that all concerned may know their rights, obligations and duties. It is far more than a mere formality.
[35] The Plaintiffs submit that the variance of an issued and entered court order may only be granted in the most exceptional circumstances and that the Defendants bear a high burden of demonstrating to this court that unless the Order is re-opened and re-drafted, a miscarriage of justice will occur. Further, the Plaintiffs submit that to succeed on this motion, the Defendants must show that the Order failed to express the clear intention of the court and that the amendment is not redundant or otherwise premature. The Plaintiffs submit that the Defendants have provided no evidence to show that the October 15 Order does not express the clear intent of the court.
[36] The Reasons for Decision and the October 15 Order have to speak for themselves, I am not sure what evidence the Defendants could call. In this regard, as I have already stated above, comparing the October 15 Order to the Reasons for Decision, the Order omits an important holding from the Reasons.
[37] The formal order does not reflect what was decided. I regard this as a mistake or oversight, of which I may be complicit, because I signed the Order as it was drafted by the parties. In my opinion, these circumstances are exceptional and it is in the interests of justice to correct this mistake in capturing in the formal order the provisions of the Reasons for Decision that were meant to be operational.
[38] Despite the arguments of the Plaintiffs, I do not see the situation at the case at bar as being an impermissible attempt to have the hybrid motion reconsidered or to re-open and challenge the October 15 Order.
[39] Relying on Papapetrou v. 1054422 Ontario Ltd., 2012 ONCA 506 at para. 28 and Nor-Dor Developments Ltd. v. Redline Communications Group Inc., 2011 ONSC 591, the Plaintiffs submit, however, that the motion to vary should be dismissed because where the operation of an order is conditional upon a subsequent judicial finding, it is premature and improper.
[40] In Papapetrou v. 1054422 Ontario Ltd., a judge on a motion for summary judgment ordered that a defendant indemnify a co-defendant without there having been a determination of whether the obligation to indemnify has been triggered. The co-defendant conceded that the order to indemnify was premature, which was another way of saying that the summary judgment was simply wrong. I do not see how Papapetrou has anything to do with the circumstances of the case at bar.
[41] In Nor-Dor Developments Ltd. v. Redline Communications Group Inc., 2011 ONSC 591, the plaintiffs sought to file their Part XXIII.1 claim under the Ontario Securities Act before leave was granted specifically in order to avoid the operation of the limitation period, and Justice Rady stated at para. 10:
It may well be that if the court gives the plaintiffs leave to commence an action for relief under Part XXIII.1, it would be appropriate at that time to ask that the order be made nunc pro tunc in order to regularize what the plaintiffs have done to date. However, it is premature to consider such relief at this stage of the proceedings.
[42] In the case at bar, the Plaintiffs did not attempt to commence their Part XXIII.1 claim before leave was granted, and rather it was the Defendants who brought a Rule 21 motion that compelled me to decide in advance of the leave motion whether the special circumstances doctrine applied. In this context, I do not think that my order that the special circumstances doctrine applies is conditional on a subsequent judicial finding. In the context of a Rule 21 motion, both parties asked me to decide the special circumstances issues, and I decided them once and for all.
[43] My finding that the special circumstances doctrine applies to the case at bar is not conditional on the outcome of the leave motion under the Ontario Securities Act. It may be that the special circumstances finding will be wasted if leave under Part XXIII.1 is not granted, and it may be that the finding will only useful if leave is granted, but I do not see how making the finding was premature. Given that the finding about the special circumstances was responsive precisely to the issue that the parties asked me to decide before the leave motion (and the balance of the certification motion) was argued, the decision cannot be said to have been made prematurely.
[44] Upon closer analysis, apart from being ironic, the Plaintiffs’ submission on the Rule 59.06 (1) motion now before the court that the special circumstances order is premature or unnecessary is really a submission that a ruling in the Reasons for Decision that was mistakenly omitted from the formal order was improper and ought not ever to have been made.
[45] If that is what the Plaintiffs mean to say, then it is just another way of saying that the Plaintiffs think I erred in making any order. If so, then it is responding party and not the moving party that is challenging my order on this motion to amend.
[46] It is not for me to decide whether my special circumstances order was made in error, but I can and do decide that the special circumstances order was advertently made in my Reasons for Decision and inadvertently omitted from the October 15 Order and, accordingly, the Defendants’ motion should be granted.
[47] If the Plaintiffs genuinely object to the special circumstances order on the grounds of its contingency or its prematurity, then they will have to appeal the arguably erroneous order. And, once again, it will be for an appellate court to determine whether the order was a final or an interlocutory order.
D. Conclusion
[48] I, therefore, conclude that the Defendants’ motion should be granted. Order accordingly.
[49] The parties agreed that there should be no order as to costs for this motion.
Perell, J.
Released: March 11, 2013
COURT FILE NO.:11-CV-424069CP
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
TRUSTEES OF THE MILLWRIGHT REGIONAL COUNCIL OF ONTARIO PENSION TRUST FUND
Plaintiff
‑ and ‑
CELESTICA INC., STEPHEN W. DELANEY and ANTHONY P. PUPPI
Defendants
REASONS FOR DECISION
Perell, J.
Released: March 11, 2013.