ONTARIO

SUPERIOR COURT OF JUSTICE

COURT FILE NO.: CV-08-89836
DATE: 20130910

BETWEEN:

CHUHER SINGH BHANGU, MANJINDER BHANGU, HARMAN PREET BHANGU and SUKHAMAN PREET BHANGU, BY HIS LITIGATION GUARDIAN, CHUHER SINGH

Plaintiffs

– and –

IRENE SANTOS and GREGORIO MANGIARDI

Defendants

Barjinder Kalsi and Yousef Jabbour, for the Plaintiffs

Michael McCluskey, for the Defendants

HEARD: September 10, 2013

ruling on motion to set aside
registrar’s dismissal for delay

Boswell J.

Overview

[1] A collision between two vehicles occurred at the intersection of Tobram Road and Eagleridge Drive in Brampton, Ontario on January 27, 2007. Chuher Singh Banghu was driving one of the involved vehicles, Irene Santos the other. The collision gave rise to two civil actions: this one, brought by Mr. Banghu and a number of his immediate family members, and a companion action, brought by Mr. Banghu’s mother-in-law, who was a passenger in his vehicle at the time of the collision.

[2] The companion action was settled at mediation in December 2012. Mr. Banghu was a named third party in that action and participated in the mediation. Mr. Banghu’s own action, however, has had a different fate. It was dismissed by the local registrar for delay, on April 20, 2011. Today he moves to set that dismissal aside so that he might continue to pursue his claim. For the reasons that follow, I have determined that the motion should be granted and the registrar’s dismissal set aside.

Chronology of Events

[3] A relatively brief chronology will provide most of the background information necessary to put the motion into perspective.

Date Procedural Step

January 27, 2007 Motor vehicle accident

June 9, 2008 Statement of Claim issued

December 4, 2008 Santos Defence filed

c. Spring 2009 Plaintiffs retain new counsel, Denise Hutner Pollock

February 17, 2010 Mangiardi Defence filed

May 3, 2010 Discovery of plaintiff

August 10, 2010 Order granting defendants leave to amend the Statement of Defence to add a Counterclaim against Mr. Bhangu

August 11, 2010 Ms. Pollock removed as plaintiffs’ counsel of record

August 16, 2010 Notice of Change of Solicitor served by Dimple Verma, but not filed

December 21, 2010 Dimple Verma advises defence counsel she does not represent the plaintiffs

January 4, 2011 Plaintiffs ordered to provide answers to undertakings within 30 days and to pay $500 in costs

March 29, 2011 Brian Atherton retained as counsel for Mr. Bhangu in his capacity as a defendant to the Counterclaim

April 20, 2011 Registrar’s Dismissal Order

April 28, 2011 Defendants’ counsel forwards Dismissal Order to Mr. Atherton

April 24, 2012 Discoveries proceed in the companion action

December 6, 2012 Companion action settled at Mediation

December 11, 2012 Plaintiffs retain BK Personal Injury Law

January 29, 2013 BK Personal Injury Law receives file from Ms. Pollock

February 20, 2013 BK Personal Injury Law receives Dismissal Order

March 21, 2013 Motion date agreed to for the purpose of setting aside the Dismissal Order.

September 10, 2013 Motion to set aside Dismissal Order.

Positions of the Parties

[4] Both sides agree on the test that is applicable to motions to set aside a Registrar’s Dismissal Order. They do not agree on the result of the application of the test. The plaintiffs argue that there was an intention at all times to pursue the litigation. They say that Mr. Bhangu is unsophisticated and was self-represented at the time the Dismissal Order was made. Given concerns about a perceived conflict, his previous counsel, Ms. Pollock, asked to be removed as counsel of record when the Counterclaim against Mr. Bhangu was commenced. He was left without counsel for a considerable period. It is not clear when, or if, the Dismissal Order came to his attention. Certainly, he did not understand that his action had been dismissed and that he was in jeopardy of never having his claim adjudicated on its merits. The plaintiffs assert that the first counsel became aware of the Dismissal Order was in late February, 2013. They attempted to negotiate a resolution with defence counsel and when that proved unsuccessful, they initiated this motion.

[5] The defendants argue that the plaintiff has not, for some considerable time, evinced an intention to seriously pursue this litigation. The loss of counsel, the failure to appoint new counsel, the failure to answer undertakings or comply with the order to answer undertakings, the failure to pay the costs ordered on January 4, 2011 and the failure to react in any way to the Dismissal Order lead to the conclusion that the plaintiff was not inclined to do anything about moving the action forward. It was only after a settlement of the companion action that he decided it might be worthwhile to retain counsel to pursue his claim again. In the meantime, the defendants have been prejudiced by the passage of time and the erosion of witness recollections.

Discussion

[6] There is a strong societal interest in seeing that disputes between citizens are resolved on their merits. Indeed, Rule 1.04 of the Rules of Civil Procedure expresses the fundamental principle that the Rules should be interpreted so as to secure “the just, most expeditious and least expensive determination of every civil proceeding on its merits.”

[7] The Rules expressly provide for motions to set aside administrative dismissals at Rule 37.14(1)(c):

37.14 (1) A party or other person who,

(c) is affected by an order of a registrar,

may move to set aside or vary the order, by a notice of motion that is served forthwith after the order comes to the person’s attention and names the first available hearing date that is at least three days after service of the notice of motion.

[8] The jurisdiction of the court to set aside an administrative dismissal remains discretionary. Rule 37.14(1) does not provide guidance on how the discretion ought to be exercised. The Court of Appeal has generally approved the application of the four criteria set out in Reid v. Dow Corning Corp., [2001] O.J. No. 2365 at para. 24, 11 C.P.C. (5th) 80 (ONSC) reversed on separate grounds, [2002] O.J. No. 3414. The criteria are as follows:

(i) A satisfactory explanation must be provided for the litigation delay;

(ii) There must be demonstrated inadvertence in missing the deadline;

(iii) The motion must be brought promptly; and,

(iv) There must be no prejudice to the defendant.

[9] These four criteria are not to be applied rigidly, but rather contextually. As Goudge J.A. held in Scaini v. Prochnicki, (2007) 2007 ONCA 63, 85 O.R. (3d) 179 (C.A.) at par. 24, the criteria described in Reid are likely to be of central importance in most cases. They are not, however, by any means, the only important criteria for the court to consider. 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.”

[10] The contextual approach directed by Justice Goudge in Scaini invites the application of the important underlying principles and values of the civil justice system inherent in the four Reid factors: see Marche D’Alimentation Denis Theriault Ltee et al. v. Giant Tiger Stores Ltd., (2007) 2007 ONCA 695, 87 O.R. (3d) 660 (C.A.) per Sharpe J.A. Those underlying principles discussed by Justice Sharpe in Marche were subsequently summarized by Cronk J.A. in Wellwood v. Ontario (Provincial Police), 2010 ONCA 386 at para. 75 as follows (internal citations omitted):

(i) modern civil procedure requires the discouragement of delay and the enhancement of an active judicial role to ensure timely justice. For this important reason, the Reid test requires an explanation for the delay occasioned in the litigation;

(ii) there is a strong public interest in promoting the timely resolution of disputes. Litigants are entitled to have their disputes resolved quickly so that they can get on with their lives. Delay multiplies costs and breeds frustration and unfairness;

(iii) excusing significant delay risks undermining public confidence in the administration of justice; and

(iv) on the other hand, our civil justice system and the requirement of prejudice under the Reid test, favour the goal of having disputes resolved on the merits;

[11] The same theme, the balancing of the interests of timely justice and respect for the timelines established by the Rules with the strong desire to see cases decided on their merits, was once again the subject of appellate comment in 1196158 Ontario Inc. v. 6274013 Canada Ltd., 2012 ONCA 544. The case arose in a somewhat different context – the dismissal of a case at a status hearing. Nevertheless, the principles in play were the same. After reviewing a number of recent cases on the issue of delay, Sharpe J.A., held, at para. 39,

These cases quite properly reflect and reinforce the 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 its core values and have done everything within their powers to combat it": Marché D'Alimentation Denis Thériault Ltée v. Giant Tiger Stores Ltd., 2007 ONCA 695, 87 O.R. (3d) 660, at para. 25, quoting Blencoe v. British Columbia (Human Rights Commission), 2000 SCC 44, [2000] 2 S.C.R. 307, at para. 146. Excusing significant delay "risks undermining public confidence in the administration of justice": Marché, at para. 32. The time lines the rules impose are relatively generous and there is a heavy price to be paid when they are not respected.

[12] I do not intend to proceed with an analysis of the Reid Factors on a one-by-one basis. Instead, I intend to articulate why, in my view, having considered those factors, I believe the plaintiffs must be permitted to proceed with their case with a view to a determination of the matter on its merits.

[13] First, it is entirely unclear when, if at all, the plaintiffs received a copy of the Registrar’s Dismissal Order. The Order is dated April 20, 2011. On its face it indicates that it was sent to counsel for the defendants. No mention of the plaintiffs or counsel for the plaintiffs is noted on the face of the document. The plaintiffs were without counsel at the time the Dismissal Order was issued. Ms. Verma had served a Notice of Change of Solicitors the previous summer, but had never filed it with the Court. From the perspective of the registrar’s office, the plaintiffs were unrepresented.

[14] Ms. Pollock was the last counsel to apparently have been formally representing the plaintiffs. Her file arrived at BK Personal Injury Law in late January 2013, but apparently did not contain the Dismissal Order, which present counsel had to request from the office of the defendants’ solicitors.

[15] I am satisfied that Mr. Atherton was provided with a copy of the Dismissal Order shortly after it was made. I am puzzled as to what happened with the Order after he received it. He did not act for the plaintiffs, rather only for Mr. Bhangu in his capacity as a defendant to the Counterclaim. One might have expected him to alert Mr. Bhangu to the jeopardy created by the Order, but whether he did is purely a matter of speculation at present.

[16] In the result, I am not satisfied that the Dismissal Order ever actually came to the attention of Mr. Bhangu prior to late January 2013.

[17] I am also satisfied that Mr. Bhangu had an intention to proceed with the litigation. There were ongoing steps in the action into the beginning of 2011, when the motion was brought to compel answers to undertakings. In April 2012 there were examinations for discovery in the companion action in which Mr. Bhangu participated. He also participated in the mediation in the companion matter in December 2012. To an unsophisticated litigant, it may very well be that there was an appearance that the legal proceedings arising from the motor vehicle accident were continuing on in due course.

[18] When BK Personal Injury Law were retained they took all reasonable steps to obtain the file from former counsel. When they saw the Dismissal Order they acted upon it immediately – first through an attempt to negotiate a resolution, then through a motion. The motion was heard a considerable time later, but I accept the explanation that it was the earliest date that counsel could both attend and which the Court could accommodate. In other words, I accept that counsel acted promptly to set aside the Order when they became aware of it.

[19] Finally, there is the issue of prejudice. I am prepared to accept that there is an inherent prejudice to the defendants in a claim that is now some five years old and which relates to an accident that occurred over six and a half years ago. In these circumstances, the plaintiffs have the onus to dispel the presumption of prejudice. If they are able to do so, the onus shifts to the defendants to demonstrate actual prejudice: see Wellwood v. Ontario Provincial Police, as above, at paragraph 60.

[20] I am satisfied that the plaintiffs have dispelled the presumption of prejudice arising due to the passage of time. There is no doubt that reliability of witness testimony can be significantly impacted by the passage of time. There are, however, a number of other factors that impact on reliability that have nothing to do with delay. Reliability involves the ability of a witness to observe, recall and recount evidence. Delay goes largely to the aspect of recall. It is the one area in this instance where there have been steps taken to enhance or improve reliability, principally through the collection of witness statements.

[21] Moreover, the presence of the companion action further reduces the impact of delay. Liability and damages remain in issue in the case at bar. They were also in issue in the companion action. The defendants were the same in that action, as were, by and large, the witnesses. The facts and circumstances of the collision have been on the minds of the parties in relation to that action and presumably it has focussed recollection.

[22] I also note that some of the delay in the proceedings must lie at the feet of the defendants. The Claim was issued in June 2008. The Santos defence was filed in December 2008, but the Mangiardi defence was not filed until February 2010. I appreciate there was an issue about service of the Claim on Mr. Mangiardi, but it seems to me that perhaps the defendants were standing on form a little too much. The same firm represents both defendants. Indeed, when a defence for Mr. Mangiardi was eventually filed, after a 14 month delay, it was in virtually identical language to that of the Santos defence.

[23] Having dispelled the presumption of prejudice, the onus shifts to the defendants to establish actual prejudice. In my view they have failed to do so.

Conclusion

[24] In the result, the motion succeeds. The Registrar’s Dismissal Order dated April 20, 2011 is set aside. Counsel each indicated to me that their partial indemnity costs were in the range of $10,000 for this motion. In my view, this was a relatively straightforward motion. The chronology is pretty clear and the law reasonably well settled. As a matter of proportionality, I would not have thought the motion would attract such significant costs. That said, with both parties providing me similar estimates of the value of the time spent on the motion, I will not quarrel at length with the figure.

[25] In the normal course costs follow the event and are awarded on a partial indemnity basis. There is no reason to depart from that general rule in this case. That said, the plaintiffs must bear some of the responsibility for the fact that this motion was necessary. For that reason, I am discounting the award of costs to $6,000 all inclusive, payable by the defendants within 30 days.

Boswell J.

Released: September 10, 2013