SUPERIOR COURT OF JUSTICE - ONTARIO

COURT FILE NO.: CV-09-372390

MOTION HEARD: JULY 11, 2013

RE: Emanuel Lazaris a.k.a. Mano Lazaris v. Computer Logistics Inc. & Big Tech Inc.

BEFORE: MASTER R.A. MUIR

COUNSEL:
Ronald G. Chapman for the moving parties/defendants
Garry J. Wise for the responding party/plaintiff

REASONS FOR DECISION

[1] The defendants bring this motion pursuant to Rules 24.01 and 48.14 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 (the “Rules”). They seek an order dismissing this action for delay. The plaintiff is opposed.

BACKGROUND

[2] This is a wrongful dismissal action. The plaintiff was apparently employed by the defendants from 2000 to 2003 and again from 2004 to 2007. The plaintiff alleges that the one year gap between 2003 and 2004 was an agreed upon leave of absence. The defendants appear to dispute this and suggest that the plaintiff’s applicable period of employment for the purposes of this action was only three years, from 2004 to 2007.

[3] The plaintiff alleges that while he was employed by the defendants he was subjected to an ongoing pattern of harassment and other improper treatment. By February 2007, this treatment had reached the point where the plaintiff alleges he could no longer remain at work. He decided to take a long weekend off. He alleges that he returned to work on February 20, 2007 to find that he had been locked out of the workplace.

[4] The defendants deny these allegations. They take the position that the plaintiff voluntarily resigned from his employment with the defendants on February 16, 2007.

[5] Between October 2007 and January 2008, the plaintiff’s lawyer wrote several letters to the defendants apparently seeking a resolution of the plaintiff’s claims. It appears that the defendants did not respond to those letters. The plaintiff then decided to commence this action in 2009.

THE LITIGATION

[6] This is a simplified procedure action. On February 13, 2009 the plaintiff issued a notice of action. His statement of claim was filed on March 13, 2009. An amended statement of claim was filed on March 30, 2009. The plaintiff seeks damages for wrongful dismissal in the amount of $44,000.00 and aggravated damages in the amount of $22,000.00.

[7] It appears that the statement of claim was served shortly after it was issued as the defendants filed their notices of intent to defend in April and May, 2013. A statement of defence was filed by Mr. Chapman on behalf of both defendants on May 13, 2009.

[8] On August 7, 2009, the plaintiff filed his notice of readiness for pre-trial conference, thereby setting this action down for trial pursuant to Rule 76.09(1).

[9] A mediation session took place on June 8, 2010. It was unsuccessful.

[10] On October 6, 2010, the plaintiff served his affidavit of documents. It appears that the defendants did not serve their affidavit of documents until May 29, 2013, after they decided to bring this motion and only after they were ordered to do so by Master Abrams.

[11] It appears that nothing was done to advance this litigation (at least in terms of the steps required by the Rules) between October 2010 and January 2013. No communications took place between the plaintiff’s lawyer and the defendants’ lawyer. In fact, the plaintiff specifically instructed his lawyer to take no steps to advance the litigation during this time period. The plaintiff explains this inactivity by pointing to the fact that he was involved in settlement discussions directly with the defendants’ representatives and was hopeful of achieving a negotiated resolution of the claim.

[12] It appears that at some point in May 2012, the settlement discussions ended. In January 2013, the plaintiff’s lawyer contacted the trial office in order to obtain available dates for a pre-trial conference. Potential dates were obtained and in March 2013, the plaintiff contacted the defendants’ lawyer and took steps to schedule a pre-trial conference, which was eventually booked for May 15, 2013 before Master Abrams. The pre-trial did not proceed apparently because the defendants’ representative did not attend. Instead, Master Abrams proceeded to deal with the matter as a case conference and made an order with respect to various scheduling issues.

[13] At the conclusion of the case conference, Master Abrams made an order as follows:

(a) the defendants’ affidavit of documents was to be served by May 29, 2013;

(b) the defendants’ motion materials in support of their motion to dismiss this action for delay were to be served by May 31, 2013;

(c) the plaintiff’s responding materials to this motion to be served by June 12, 2013;

(d) examinations for discovery to take place on July 17, 2013;

(e) this action to be tried during the week of January 13, 2014; and,

(f) the defendants were to pay the plaintiff’s costs of the May 15, 2013 appearance in the amount of $350.00, payable in the cause.

[14] The defendants did serve their affidavit of documents on May 29, 2013 in compliance with the order of Master Abrams. However, the plaintiff takes the position that it did not include all of the documents required by Master Abrams’ order.

THE MOTION

[15] The defendants did not serve a proper motion record in accordance with Master Abrams’ order. The moving parties’ motion record was not served until June 20, 2012. However, the defendants did serve a draft notice of motion and a supporting affidavit in advance of the May 31, 2013 deadline. The plaintiff actually complied with Master Abrams’ timetable order by serving a motion record on June 12, 2013 despite the fact that the defendants’ formal motion record had not been served. Supplementary materials were served by both sides in late June and early July 2013. On June 21, 2013 the defendants conducted a cross-examination of the plaintiff on his affidavit sworn June 11, 2013. This cross-examination was in contravention of Rule 76.04 which prohibits cross-examination in simplified procedure actions. This motion was then argued before me on July 11, 2013.

[16] On July 12, 2013 I received a written request from Mr. Chapman for permission to make further submissions in connection with my jurisdiction to hear this motion (other than pursuant to Rule 24). By letter dated July 17, 2013, Mr. Wise advised the court that the plaintiff opposed the defendants’ request.

[17] On July 17, 2013, I advised the parties that I was not prepared to allow any further submissions. This matter was fully argued on July 11, 2013. The defendants brought this motion pursuant to Rules 24 and 48. No other grounds for the motion were relied upon. If the defendants intended to argue this motion on some other basis, it should have been clearly set out in the notice of motion or in a supplementary notice of motion. The further submissions the defendants now wish to make could have been made on July 11, 2013. They do not rely on new case law or developments that took place following argument. Finally, this is a simplified procedure action. Given my conclusions set out below, further submissions would only result in additional wasted time and expense to the parties. This matter needs to be determined on its merits.

ANALYSIS

[18] Rule 24.01(1) provides as follows:

24.01 (1). A defendant who is not in default under these rules or an order of the court may move to have an action dismissed for delay where the plaintiff has failed,

(a) to serve the statement of claim on all the defendants within the prescribed time;

(b) to have noted in default any defendant who has failed to deliver a statement of defence, within thirty days after the default;

(c) to set the action down for trial within six months after the close of pleadings; or

(d) Revoked.

(e) to move for leave to restore to a trial list an action that has been struck off the trial list, within thirty days after the action was struck off.

PRELIMINARY ISSUES AND JURISDICTION

[19] The plaintiff made two preliminary objections to the defendants’ motion. First, the plaintiff argued that the defendants are in default under the Rules and in default of Master Abrams’ order of May 15, 2013. The plaintiff takes the position that the defendants’ affidavit of documents was served well after the deadline in the Rules and does not include all of the documents Master Abrams specifically ordered to be included in the affidavit of documents. The plaintiff also argues that the defendants failed to serve a formal notice of motion and motion record prior to the deadline imposed by Master Abrams in her May 15, 2013 order.

[20] I am not prepared to give effect to this objection. It is true that the defendants’ affidavit of documents was served well after the deadline imposed by the Rules. However, a sworn affidavit of documents has now been served. The defendants are no longer in default.

[21] Moreover, I am unable to determine whether the defendants have failed to include all relevant documents in their affidavit of documents as ordered by Master Abrams. The defendants’ affidavit of documents was not put into evidence on this motion. I do not know what documents were included. It may be that the defendants simply do not have any documents that fall within the categories listed in Master Abrams’ order. Again, I simply have no way of knowing.

[22] I am also satisfied that the defendants have substantially complied with Master Abrams’ timetable order for this motion. A draft notice of motion and a sworn supporting affidavit were provided in advance of the deadline. The plaintiff was fully able to respond to the defendants’ motion by the deadline imposed on him by Master Abrams.

[23] Finally, I note that the Court of Appeal has stated that for motions of this nature, substantial compliance with the “not in default” requirement is sufficient. The court should not insist on overly technical compliance with the Rule. See Frank Stollery Ltd. v. Toronto Electric Commissioners, [1999] O.J. No. 2354 (C.A.) at paragraph 4.

[24] The plaintiff’s second objection relates to the substantive provisions of Rule 24.01. The Rule sets out four potential bases for a motion under Rule 24.01. None of those reasons are applicable to the facts before the court on this motion. All defendants were served with the statement of claim within the time prescribed by the Rules. All defendants have defended the action and there are no defendants who should have been noted in default. This action was set down for trial on August 7, 2009, approximately three months after the close of pleadings. Finally, this action was never struck from the trial list. In short, the plaintiff has done everything required by Rule 24.01. None of the available criteria have been established by the defendants.

[25] In my view, this is not a mere technicality. It is Rule 24.01 that provides this court with the authority to grant the very serious remedy being sought by the defendants. Defendants who rely on Rule 24.01 in order to obtain such relief must demonstrate that a plaintiff’s alleged default falls squarely within one of the enumerated categories. On this motion, the defendants have not done so.

[26] The defendants argued that this court nevertheless has discretion to dismiss this action for delay despite the fact that none of the requirements of Rule 24.01 have been met. There is authority for the proposition that where an action cannot be dismissed under Rule 24.01, it can properly be dismissed as an abuse of process. See Convay v. Marsulex Inc., [2002] O.J. No. 4655 (C.A.) at paragraph 3. However, it is my view that the power of the court to dismiss an action on this basis arises from the court’s inherent jurisdiction to control its own process or perhaps on the basis of Rule 21.01(3)(d). See Housser v. Savin Canada Inc., 2005 35779 (ON SC), [2005] O.J. No. 4217 (S.C.J.) at paragraphs 9 and 44-45. In either scenario, a master does not have jurisdiction to make such an order. A master does not have inherent jurisdiction. Everything a master does must be authorized by the Rules or by statute. See Ontario (Attorney General) v. Victoria Medical Building Ltd., 1959 20 (SCC), [1959] S.C.J. No. 70 at pages 7-8. As for Rule 21, the provisions of that Rule specifically require that such motions be brought before a judge.[^1]

[27] Counsel for the defendants also pointed to a reference in Ontario Civil Practice 2009[^2] at page 617 where the authors stated that the court has discretion, in certain circumstances, to dismiss a claim on the basis of delay. However, the authority relied upon by the learned authors[^3] is a decision dealing with a consideration of the applicable factors on a motion under Rule 24.01. It does not stand for the general proposition that a master can exercise his or her discretion to dismiss an action for delay outside of the parameters of Rule 24.01.

[28] Finally, it is important to note that the defendants’ notice of motion and supplementary notice of motion only refer to Rules 24 and 48. No reference is made to the inherent jurisdiction of the court or abuse of process as a basis for the relief they are seeking.

DISMISSAL FOR DELAY

[29] Even if I had concluded that I did have the authority to entertain the defendants’ motion under Rule 24.01, I would not have dismissed the plaintiff’s action.

[30] The test to be applied on motions to dismiss for delay is set out in the decision of the Court of Appeal in Langenecker v. Sauvé, 2011 ONCA 803. At paragraphs 6 and 7 of that decision, the Court of Appeal describes the two types of cases that are susceptible to dismissal for delay:

[6] The first type of case described by Lord Diplock refers to those cases in which the delay is caused by the intentional conduct of the plaintiff or his counsel that demonstrates a disdain or disrespect for the court process. In dismissing cases which fall within this category, the court effectively declares that a continuation of the action in the face of the plaintiff’s conduct would constitute an abuse of the court’s process. These cases, thankfully rare, feature at least one, and usually serial violations of court orders . . .

[7] The second type of case that will justify an order dismissing for delay has three characteristics. The delay must be inordinate, inexcusable and such that it gives rise to a substantial risk that a fair trial of the issues in the litigation will not be possible because of the delay . . .

[31] In my view, the first category is not applicable. I see nothing in the conduct of the plaintiff that can be described as disdain or disrespect for the court’s process. The plaintiff has not breached any court orders. In fact, the plaintiff has complied with all specific procedural requirements set out in the Rules.

[32] The second category of cases must meet three requirements. The delay must be inordinate, inexcusable and give rise to a substantial risk that a fair trial will not be possible. In my view, the delay has not been inordinate or inexcusable. Between February 2009 and October 2010, the plaintiff served his statement of claim, set the action down for trial, arranged for a mediation session and served his affidavit of documents. It is true that no steps were taken between October 2010 and January 2013 to schedule a pre-trial conference. However, the evidence shows that joint efforts were being made to reach a settlement of this matter during most of that time period. The email communications produced by the plaintiff indicate ongoing efforts to reach a settlement. It appears that those efforts were hampered somewhat by the schedules of the parties and by the fact that the plaintiff was living in Thunder Bay. I do not fault the plaintiff for attempting to settle this action. However, I do agree with the defendants that it would have been prudent for the plaintiff’s lawyer to have advised the defendants’ lawyer of the plaintiff’s ongoing intentions with respect to this claim.

[33] By May 2012 the settlement discussions had broken down. Nothing further was done to advance this claim until January 2013. No satisfactory explanation has been provided for this period of delay. However, it is my view that this eight month period of delay cannot be described as inordinate and inexcusable. Since January 2013, the plaintiff has moved expeditiously to obtain pre-trial and trial dates and this matter is now fixed for trial in January 2014.

[34] Given this conclusion, it is not necessary that I consider the defendants’ allegations of prejudice and determine whether there is a substantial risk that a fair trial will not be possible.

[35] Therefore, even if I had the authority to dismiss this action for delay, I would not have exercised my discretion to do so in these circumstances.

RULE 48.14

[36] One further issue needs to be addressed. The defendants’ supplementary notice of motion dated July 2, 2013 relies on Rule 48.14 in addition to Rule 24. The original notice of motion only referred to Rule 24.

[37] In their supplementary notice of motion, the defendants state that this action should have been dismissed by the registrar on February 13, 2011 pursuant to Rule 48.14(1).[^4] This Rule provides as follows:

Unless the court orders otherwise, if an action in which a defence has been filed has not been placed on a trial list or terminated by any means within two years after the first defence is filed, the registrar shall serve on the parties a status notice in Form 48C.1 that the action will be dismissed for delay unless, within 90 days after service of the notice, the action is set down for trial or terminated, or documents are filed in accordance with subrule (10).

[38] In my view, this Rule does not assist the defendants. First, the registrar did not dismiss this action pursuant to Rule 48.14 or any other Rule.

[39] Second, where an action is not set down within two years after the first defence has been filed, the registrar first issues a status notice. The registrar does not automatically dismiss the plaintiff’s action. A plaintiff can then avoid the consequences of the Rule by, among other things, setting the action down for trial. In this case, the plaintiff had already done so.

[40] Finally, this is a simplified procedure action. The set down requirements and procedures are not the same as ordinary actions by virtue of Rule 76.09.

CONCLUSION

[41] For the reasons set out above, the defendants’ motion is dismissed.

COSTS

[42] The plaintiff seeks his costs on an elevated scale. The plaintiff argues that this motion was ill-conceived and bound to fail. The defendants submit that by allowing this action to continue the court has granted the plaintiff a substantial indulgence. The defendants submit that there should be no order as to costs.

[43] The plaintiff’s costs outline sets out substantial indemnity costs of $6,379.46 and partial indemnity costs of $4,303.40. Those amounts do not include the 90 minute attendance on July 11, 2013.

[44] The defendants’ costs outline identifies full indemnity costs of $10,812.55 and partial indemnity costs of $7,920.72.

[45] When dealing with costs, the overall objective for the court is to fix an amount that is fair and reasonable for the unsuccessful party who generally must pay the costs of the successful party. See Zesta Engineering Ltd. v. Cloutier, 2002 25577 (ON CA), [2002] O.J. No. 4495 (C.A.) at paragraph 4 and Boucher v. Public Accountants Council for the Province of Ontario, 2004 14579 (ON CA), [2004] O.J. No. 2634 (C.A.) at paragraph 26.

[46] The plaintiff has been entirely successful on this motion. In my view, he is entitled to costs, although on a reduced basis.

[47] I see no evidence of reprehensible conduct on the part of the defendants that would justify a costs order on an elevated scale. In fact, it is my view that the plaintiff has been afforded a modest indulgence. The plaintiff’s lawyer should have kept the defendants’ lawyer apprised of the plaintiff’s intentions concerning this litigation and should have asked for the defendants’ indulgence in that regard. In addition, the plaintiff provided no explanation for the delay between May 2012 and January 2013. Finally, I am not prepared to award any costs in connection with the cross-examination of the plaintiff conducted in violation of Rule 76.04.[^5]

[48] In addition to considering these factors, I have also reviewed the costs outlines of the parties and considered the principles set out in Rule 57.01(1). I have concluded that it is fair and reasonable that the defendants pay the plaintiff’s costs of this motion in the amount of $3,000.00.

ORDER

[49] I therefore order as follows:

(a) the defendants’ motion is dismissed; and,

(b) the defendants shall pay the plaintiff’s costs of this motion, fixed in the amount of $3,000.00 inclusive of HST and disbursements, payable within 30 days.

Master R.A. Muir

DATE: July 18, 2013

[^1]: Rule 25.11(c) does give a master the jurisdiction to strike out a pleading or other document as an abuse of the process of the court. However, that Rule specifically relates to a pleading or document which, by itself, amounts to an abuse of process. In my view, that Rule cannot be read to extend to the manner in which an action has been pursued.

[^2]: Garry D. Watson & Michael McGowan, Ontario Civil Practice 2009 (Toronto: Thomson Carswell, 2009). The same reference appears in the 2013 edition.

[^3]: Weber v. Erb and Erb Insurance Brokers Ltd., [2006] O.J. No. 1279 (S.C.J.).

[^4]: The defendants’ supplementary notice of motion actually refers to Rule 48.14(0.1)(1) but that would appear to be a typographical error. It appears that the reference should be to Rule 48.14(1).

[^5]: Both parties agreed that approximately two hours of time was devoted to the cross-examination.