SUPERIOR COURT OF JUSTICE - ONTARIO

COURT FILE NO.: 12-CV-463319
MOTION HEARD: July 30, 2013

Re: Irene Tsanos

Plaintiff

v.

Carlo Bello and 1408998 Ontario Inc.
Defendants

BEFORE: Master Thomas Hawkins

APPEARANCES:
Maritza C. Estridge
for moving defendants
F: (416) 362-5289

Richard A. Levin for responding plaintiff
F: (416) 363-3118

REASONS FOR DECISION

Nature of Motion

[1] In this personal injury action arising from a motor vehicle accident the defendants move for an order setting aside the registrar’s noting of the defendants of default at the plaintiff’s request on December 3, 2012.

[2] The defendants move under subrule 19.03(1). This subrule provides as follows.

The noting of default may be set aside by the court on such terms as are just.

Legal Test

[3] In Metropolitan Toronto Condominium Corporation No. 706 v. Bardmore, 1991 7095 (ON CA), [1991] O.J. No. 717 (“Bardmore”) McKinlay J.A., speaking for the Court of Appeal for Ontario in an appeal as to whether a noting of default should be set aside, said the following (at paragraph 18).

Such factors as the behaviour of the plaintiff and of the defendant, the length of the defendant’s delay, the reasons for the delay, and the complexity and value of the claim involved are all relevant factors to be taken into consideration. However, I consider that it would only be in extreme situations that a trial judge would exercise his discretion to require an affidavit as to the merits of the defence on a motion to set aside a noting in default.

[4] In the more recent decision in Nobosoft Corp. v. No Borders Inc. (2007), 2007 ONCA 444, 43 C.P.C. (6th) 36 the Court of Appeal for Ontario referred to Bardmore with approval.

Behaviour of Plaintiff and Defendants

[5] I will now discuss the various Bardmore factors, beginning with the behaviour of the plaintiff and the defendants and their respective agents. That behaviour may be summarized in the following chronology of events.

Date

Event

September 13, 2010

Plaintiff injured in motor vehicle accident

October 14, 2010

Defence insurance adjuster contacts plaintiff to discuss accident.

November 3, 2011

Plaintiff first retains her present counsel.

November 7, 2011

Plaintiff’s counsel writes defendants notifying them of her claim.

December 13, 2011

Defence insurance adjuster writes plaintiff’s counsel requesting medical documentation on plaintiff.

May 4, 2012

Plaintiff’s counsel writes defence insurance adjuster enclosing extensive medical information on plaintiff.

June 1, 2012

New defence insurance adjuster writes plaintiff’s counsel advising that she was prepared to engage in settlement discussions.

June 12, 2012

Plaintiff’s counsel writes new defence insurance adjuster enclosing further medical information on plaintiff and advises that it would be premature to discuss settlement.

September 12, 2012

Present action commenced.

September 14, 2012

Plaintiff’s counsel speaks with new (third) insurance adjuster and advises her that this action has been commenced. He agrees not to require an immediate defence.

September 17 & 18, 2012

Defendants served with statement of claim.

October 25, 2012

Plaintiff’s counsel has fruitless settlement discussion with third defence insurance adjuster.

October 26, 2012

Third defence insurance adjuster calls plaintiff’s counsel and advises him for the first time that insurer disputes liability for subject accident.

October 29, 2012

Plaintiff’s counsel advises third defence insurance adjuster that he requires a statement of defence and that she should attend to this immediately.

November 19, 2012

Plaintiff’s counsel advises third defence insurance adjuster that if the statement of defence is not served by November 23, 2012, he will note the defendants in default.

November 28, 2012

Plaintiff’s counsel files with court registrar requisition to note defendants in default.

December 3, 2012

Registrar notes defendants in default.

December 5, 2012

Plaintiff’s law clerk emails new (fourth) defence insurance adjuster copy of registrar’s requisition form advising that defendants had been noted in default.

December 13, 2012

Settlement discussions between plaintiff’s counsel and fourth defence insurance adjuster end with no settlement.

January 9, 2013

Insurer retains counsel to defend this action.

January 29, 2013

Defence counsel writes plaintiff’s counsel asking if he will consent to setting aside the noting of the defendants in default.

February 1, 2013

Defence counsel writes follow-up letter to plaintiff’s counsel advising if consent not forthcoming, he will move to set aside the noting of the defendants in default.

March 6, 2013

Defence counsel writes second follow-up letter to plaintiff’s counsel.

March 8, 2013

Defence counsel sends requisition to schedule short motion to this court’s motion scheduling unit.

March 14 to April 17, 2013

Counsel exchange several offers and counter-offers to set aside the noting in default on terms, none of which is accepted.

July 12, 2013

Defence motion record on motion to set aside noting in default served on plaintiff’s counsel.

July 30, 2013

Motion is argued. Judgment is reserved.

[6] I will now proceed to comment on the conduct of the parties and their agents. The parties themselves (the plaintiff and the defendants) seem to have had no contact with each other after the motor vehicle accident in question. The only contacts between the parties were between the plaintiff’s lawyer on the one hand and a series of insurance adjusters on the other hand.

[7] It is clear that plaintiff’s counsel gave the defence insurer ample time to deliver a statement of defence and a clear warning that if a defence were not forthcoming, he would have the defendants noted in default. The defence insurer knew by December 5, 2012 that the defendants had been noted in default. The insurer seems to have been very, very slow to react to these events.

Length of Defendant’s Delay

[8] The next Bardmore factor is the length of the defendant’s delay. I calculate that delay to be three months. It runs from October 29, 2012 (when plaintiff’s counsel requested a statement of defence) to January 29, 2013 (when defence counsel wrote plaintiff’s counsel asking if he would consent to the setting aside of the noting of the defendants in default). While this period of delay is significant, I do not feel that it is inordinate or excessive.

Reasons for Delay

[9] The third Bardmore factor is the reason or reasons for the defence delay. Here the defence insurer seems to have been obsessed with saving money. The insurer appears to have been extremely reluctant to incur the expense of retaining a lawyer to defend the action. The insurer engaged in settlement negotiations for one year (December 2011 to December 2012), which negotiations went nowhere. The insurer’s file on the plaintiff’s claim passed through the hands of no less than four adjusters. This undoubtedly contributed to the overall delay, as each new adjuster had to become familiar with the file.

[10] The evidence before me does not justify a finding that the insurer acted in bad faith. While the reason for the delay is not flattering (the insurer is a penny pincher), that reason is not a basis for dismissing this motion.

Complexity and Value of Claim

[11] The fourth Bardmore factor is the complexity and value of the claim. This action arises out of a motor vehicle accident. If the allegations in the statement of claim are true, the plaintiff has suffered serious injuries and has sustained significant losses including a loss of income from self employment. That loss of income claim will be more difficult to prove than a claim for loss of the salary paid to an employee.

[12] My ability to assess the complexity of the plaintiff’s claim is limited because defence counsel has not included a draft statement of defence in his motion materials. That said, the evidence before me indicates that the defence may dispute liability for the subject accident on the basis that there was no contact between the plaintiff’s car and the defendant’s truck, and that the plaintiff simply over-reacted to the presence of the defendant’s truck near her car, and lost control of her car resulting in her injuries. Further, the medical evidence on the plaintiff’s injuries suggests that some at least of those injuries are the exacerbation of a pre-existing condition rather than a completely fresh injury. How difficult it will be to sort out these issues I cannot say. Nevertheless they do add to the complexity of the plaintiff’s action.

[13] The plaintiff is claiming $700,000 in damages. These are largely general damages. The evidence before me does not enable me to express an opinion as to the amount of damages the plaintiff is likely to recover if successful.

Other Factor: Prejudice

[14] The fact that in Bardmore, McKinlay J.A. used the phrase “such factors as” makes it clear that she did not intend her list of factors to be considered as an exhaustive one. In any given case, the court may consider other factors. I therefore propose to consider whether, during a period of delay by the defendants, the plaintiff suffered non-compensable prejudice.

[15] Here there is no evidence that during a period of delay by the defendants, a witness helpful to the plaintiff has died or disappeared and cannot be located despite reasonable efforts to find that witness. There is no evidence that, for example, the plaintiff’s car can no longer be examined to see if the damage to her car is such that it is clear that there was or was not any impact between her car and the defendant’s truck. There is no evidence that documents helpful in proving the plaintiff’s case have been inadvertently lost or destroyed.

[16] In short, on the record before me, there is no evidence that during a period of delay by the defendants, something happened that caused the plaintiff to suffer non-compensable prejudice.

Conclusion and Terms

[17] Having considered all the above factors, I have come to the conclusion that the noting in default of the defendants should be set aside on terms. Those terms are as follows. The defendants are to do the following within the stated periods of time after the date of service on them of the formal order disposing of this motion:

(a) deliver their statement of defence within 14 days;

(b) enter into a discovery plan with the plaintiff within 20 days;

(c) serve their affidavits of documents within 30 days; and

(d) submit to examination for discovery by the plaintiff within 60 days.

[18] If, for any reason, the parties are unable to comply with this timetable, either side may write me requesting a case conference. I will then convene such a conference under subrule 77.04(2) and timetable the remaining steps in this action to the point where this action is set down for trial.

[19] Subrule 77.04(2) provides as follows.

A judge or case management master may, on his or her own initiative, require the parties to appear before him or her or to participate in a conference call to deal with any matter arising in connection with the case management of the proceeding, including a failure to comply with an order or the rules.

Costs

[20] Although the defendants have been successful on this motion. I consider that, by setting aside the noting of the defendants in default despite clear warnings from plaintiff’s counsel that they would be noted in default absent the prompt delivery of their statement of defence, I have granted the defendants an indulgence.

[21] The price of an indulgence is the payment of the costs of those who have sought, unsuccessfully, to prevent its being granted. See Fox v. Bourget (1987), 17 C.P.C. (2d) 94 (Ont. Dist.Ct.).

[22] I therefore order the defendants to pay the plaintiff her costs of this motion fixed at $1,876.55 within 30 days.

Master Thomas Hawkins

DATE: November _____, 2013