ONTARIO
SUPERIOR COURT OF JUSTICE
Court File No.: CV-10-263-SR
Date: 2013/12/05
BETWEEN:
SHIRECREST HOMES INC. and ADVANCED FRAMING CORP.
Brian R. Law, for the Plaintiffs
Plaintiffs
- and -
MAXINE COLE and JOSEPH MARTIN VAN DEN HURK
Peter M. Quinlan, for the Defendants
Defendants
HEARD: November 20, 2013
The Hon. Mr. Justice J. C. Kent
REASONS FOR RULING
Issue: Should this court grant judgment in accordance with an accepted offer to settle?
Background:
[1] The trial in this matter was initially scheduled for 5 days to commence the week of March 25, 2013. On March 25 the trial was adjourned to commence the week of November 18th. On November 20, 2013, counsel for the defendants brought a pre-trial motion for judgment based on an offer to settle that had been accepted. Counsel relied on Rule 49.09 (a).
[2] The plaintiffs Shirecrest Homes Inc. and Advanced Framing Corp. made an offer to settle dated 11 February 2013. The defendants, Maxine Cole and Joseph Martin Van Den Hurk accepted that offer by an acceptance dated 13 November 2013. For purposes of completeness the offer and the acceptance found at Tabs 2 and 3 of the Motion Record of the moving party are reproduced as Schedule A to these reasons.
[3] Rule 49.07(5) provides that where an accepted offer to settle does not provide for the disposition of costs, the plaintiff is entitled, when the offer has been made by the plaintiff, to the plaintiff’s costs assessed to the date that the notice of acceptance was served. Since the offer made by the plaintiffs in this case did clearly address costs the operation of this rule is not engaged.
[4] Rule 49.09 provides that where a party to an accepted offer to settle fails to comply with the terms of the offer, the other party may,
“(a) make a motion to a judge for judgment in the terms of the accepted offer, and the judge may grant judgment accordingly.”
Is this a case where judgment should be granted pursuant to the aforementioned provision?
Law:
[5] The policy of the court should be to promote settlements. See: Richard V. Worth, 2004 34517 (ON SC), 2004, Carswell Ont. 4310 at para. 21.
[6] There is no doubt that the court has a discretion under Rule 49 whether or not to enforce the terms of a settlement. However, that discretion “should be rarely exercised and utmost consideration must be given to the policy of the courts to promote settlements.” See: Richard v. Worth at page 17. See also the decision of the Ontario Court of Appeal, Fox Estate v. Stelmaszyk 2003 Carswell Ont. 2506. In Fox, the court, with reference to earlier decisions, observed that the discretion to refuse to grant judgment on an accepted offer was a rare case and should be exercised only in “limited circumstances”.
[7] Counsel for the responding parties drew the court’s attention to the decision of Siegel, J. of this court Gupta v. Njuyen 2006 Carswell Ont. 3289 and in particular to the court’s consideration of a much delayed acceptance of an offer. The Gupta case, however, is distinguishable on its facts.
[8] The Fox case is probably the strongest support for the responding parties. At para. 11 of the judgment of the Court of Appeal it was observed that, “respondents’ counsel took advantage of appellants’ counsel’s mistake on the eve of a judicially considered assessment of entitlement.” Carthy, J.A. observed that in those circumstances it did not satisfy his sense of justice to enforce the settlement. He concluded that equity favoured the appellants.
Considerations:
[9] The offer to settle made by the plaintiffs was made almost six weeks before a contemplated 5 day trial. It appears that the offer was carefully prepared and tactically considered, bearing in mind in the possibility of ultimately triggering Rule 49 consequences. In two paragraphs the offer addressed costs and in neither paragraph did it make any proviso regarding costs from the date made to the date accepted. The offer was never withdrawn and remained open for acceptance until “one minute after the commencement of the trial of this matter”. After the trial was adjourned from the week of March 25, 2013 to the week of November 18, 2013, both plaintiffs and defendants incurred substantial further expenses including both disbursements and fees.
[10] The offer of the plaintiffs was never revised to take into consideration the intervening circumstances.
Result:
[11] The above circumstances and factors do not persuade me that this is one of the rare instances where the court should exercise its discretion and refuse to grant judgment in accordance with an accepted offer of settlement. Judgment, therefore, will go in accordance with the relief sought by the moving party at paragraphs (a) and (b) of the notice of motion.
Costs:
[12] If the parties are unable to agree on costs they may address the issue by way of written submissions. The successful parties’ submissions to be made within 14 days of the release of these reasons, the response to be with 14 days thereafter and the reply, if any, within 7 days after response. Submissions are to be limited to 3 pages together with a costs outline.
KENT, J.
Released: 5 December, 2013
COURT FILE NO.: CV-10-263-SR
DATE: 2013/12/05
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
SHIRECREST HOMES INC. and ADVANCED FRAMING CORP.
Plaintiffs
- and -
MAXINE COLE and JOSEPH MARTIN VAN DEN HURK
Defendants
REASONS FOR JUDGMENT
KENT, J.
Released: 5 December, 2013