SUPERIOR COURT OF JUSTICE – ONTARIO

COMMERCIAL LIST

RE: Ramesh Mehta, Seema Mehta Shivani International Foods Ltd., Sirdi Sweets Inc. and Seema Holdings Inc., Plaintiffs

AND:

Harbans Singh Sidhu, Majit Kaur Sidhu, 1413817 Ontario Inc., 2150374 Ontario Inc., 1560634 Ontario Inc., 2029125 Ontario Inc., 2164968 Ontario Inc., Defendants

BEFORE: D. M. Brown J.

COUNSEL:
T. Walker, for the Plaintiffs

A. Pribetic, for the Defendants

HEARD: December 9, 2013

9:30 appointment endorsement

Refusals and remaining steps before setting a trial date

[1] The parties have complied with the timetable set out in my September 17, 2013 endorsement. In terms of further steps to complete the preparation of this action for trial, I make the following order:

Formal pre-trial conference

(i) I dispense with the need to arrange a formal pre-trial conference. Given the credibility issues in dispute, the prospects for settlement are low and the disputed issues require a judicial adjudication;

Amendment to Statement of Claim

(ii) The plaintiffs shall seek to amend their Statement of Claim to correct a certain reference at the start of trial; the defendants do not oppose the proposed amendment;

Expert reports

(iii) The plaintiffs shall serve their expert’s report by December 31, 2013; the defendants shall serve their responding expert report by March 15, 2014;

Refusals

(iv) On the issue of refusals – a potential motion by the plaintiffs on 21 refusals and a similar motion by the defendants on about 10 refusals – I offer the parties the following options:

a. Option A: I am prepared to write an endorsement which states that the parties have agreed to refrain from bringing refusals motions, but on the clear understanding that by so doing they will not be faced at trial with the submission by an opposite party that their failure to move on refusals should work against them. Under this scenario, if, at trial, an issue arises about a question refused, then the trial judge can consider the matter. If the trial judge concludes that the refusal was proper, so be it. If the trial judge concludes that the refusal was improper, then an adverse inference would be drawn against the refusing party for failing to disclose material evidence;

b. Option B: The parties may deliver, to my attention, motion records for refusals motions in writing no later January 17, 2014. They shall deliver responding motion records or materials, to my attention, no later than January 24, 2014. I shall deal with the refusals motions as motions in writing. However, as indicated at the conference this morning, I wish to give the parties a “heads-up” that if they proceed by way of motion, I shall approach the costs of that motion on an “amount per refusal” basis, specifically $1,500.00 per refusal, payable within 30 days. That is to say, if the defendants move on 8 refusals, but succeed only on two, they may risk adverse cost consequences of up to $6,000 (i.e. success on 2 refusals (+$3,000) less failure on 6 refusals (-$9,000), or a “net” adverse cost award of $6,000). By communicating my approach to costs to the parties in advance of them bringing a refusals motion, I wish to afford them an opportunity to a take a sober look at exactly how many refusals are material for a fair determination of the issues at trial and therefore require adjudication by this Court;

c. Option C: The parties can identify those refusals in respect of which they wish to use Option A and those in respect of which they wish to proceed with a motion under Option B. I offer this third option recognizing that in some actions important, proper questions may well be wrongfully refused on an examination and that fairness requires an adjudication of those refusals in advance of the trial so that the actual disclosure of specific information occurs before trial, rather than simply relying on the drawing of an adverse inference. The number of such material refusals in any action usually is quite small, based upon my review over the years of transcripts filed by parties in other cases. The cost consequences outlined in Option B should operate to confine the number of argued refusals only to very material issues.

I would ask counsel to write me a joint letter no later than Thursday, December 19, 2014, advising which of the Options their clients have selected.

[2] The preparation of this action has proceeded to the stage where counsel should secure an appointment before Morawetz J. for a date no later than January 17, 2014, to fix a date for the trial of this action. From my discussion with counsel, it appears that one (1) week will be required for the trial.

D. M. Brown J.

Date: December 9, 2013