ONTARIO

SUPERIOR COURT OF JUSTICE

COURT FILE NO.: CV-09-4094-00
DATE: 20131210

B E T W E E N:

TREVOR WELCH and GUYLAINE DOSTIE

Anthony Andreopoulos for the Plaintiffs

Plaintiffs

• and -

PEEL STANDARD CONDOMINIUM CORPORATION NO. 755 and DOWNING STREET PROPERTY MANAGEMENT INC. and FOREST CONTRACTORS LTD.

E. Lipetz for Peel and Downing;

R. Bacchus for Forest Contractors Ltd.

Defendants

HEARD: December 4, 2013

REASONS FOR JUDGMENT

Baltman J.

1The plaintiffs Welch and Dostie brought a claim against the owner and manager of the condominium premises where they reside, for injuries Welch sustained in a slip and fall on an icy area within the premises. More than two years later the plaintiffs discovered that Forest Contractors Inc. was responsible for the maintenance of the property at the time of the accident, and then proceeded to add Forest as a defendant. The owner and manager cross-claimed against Forest.

2Forest has brought a motion for summary judgment to dismiss both the plaintiff’s action and the cross-claim, on the basis that they fall outside the limitation period. The parties agree the relevant limitation period is two years; the issue here is discoverability: when did the plaintiffs and the defendants discover their claim against Forest, thus triggering the two year period?

Factual Background

3The plaintiffs are a married couple who live in a condominium in Mississauga. On February 20, 2008, Welch slipped and fell on an icy sidewalk within the common area of the condominium facility. He sustained a significant back injury which eventually required surgery.

4The plaintiffs retained counsel - the RZCD Law Firm - in June 2008. RZCD placed the defendants (Peel and Downing) on notice September 8, 2008. Although Peel and Downing are separate defendants their interests are common and they are represented by the same insurer (ING), and the same law firm (Benson Percival).

5What in my view was a pivotal event in this case occurred on November 17, 2008. Usman Bhatti, associate counsel at RZCD, spoke by telephone to James Reilly, the insurance adjuster assigned to the file by ING. Bhatti asked Reilly if there was any maintenance company involved other than Downing, and was told there was not. Importantly, Bhatti’s handwritten note in his file confirms this conversation:

-discussion wi [sic] J. Riley (ING) Downing
-complaining about incident report not filed
-asked him if we should also sue others
-other potential ∆s [defendants]??? Ø none
-f/up later today or tomorrow [emphasis added]

6The plaintiffs issued their statement of claim against the defendants on September 9, 2009, and served them with the statement of claim on September 22, 2009. The defendants subsequently served a Statement of Defence and an Affidavit of Documents, neither of which made any reference to a maintenance company.

7Examinations for Discovery were scheduled for June 10, 2010, but did not proceed, because that same morning defence counsel were apprised by their clients that they had contracted with a maintenance company at the time of the loss. By correspondence dated July 14, 2010 to plaintiff’s counsel, defence counsel identified the contractor as Forest Contractors Ltd.

8For reasons that are unclear, instead of the defendants bringing a third party claim against Forest, all counsel agreed that the plaintiffs would add Forest as a defendant. Moreover, although plaintiffs’ counsel provided a draft amended statement of claim to the defendants for their approval in November 2010 (which added Forest as a defendant), and followed up on several occasions over the next several months, it was not until April 19, 2011 that defence counsel provided their consent. The plaintiffs then proceeded with the motion to add Forest and issued the claim against Forest on August 31, 2011.

9The parties agree the relevant limitation period is two years. The dispute is over when that period begins, both with respect to the main claim and the cross-claim.

Positions of the Parties

10With respect to the main claim, Forest argues that the plaintiffs did not make adequate inquiries to determine the existence of Forest prior to being expressly informed of their identity by Downing on July 14, 2010. Forest maintains that given the evidence regarding their “obvious” presence on the property in February 2008, the limitation period expired in February 2010. As the plaintiffs did not issue their statement of claim against Forest until August 31, 2011 (or serve it until March 2012), they are out of time.

11The plaintiffs, on the other hand, assert that the limitation period did not begin to run until July 14, 2010, when defence counsel advised that – contrary to the earlier impression left by ING – the maintenance for the property had been contracted out to Forest.

12As for the cross claim, Forest asserts that given that the defendants were parties to the contract with Forest, they had actual knowledge of Forest’s involvement and therefore the two year limitation period for them runs from September 22, 2009, the day they were served with the statement of claim. As the defendants failed to serve Forest with their cross-claim until November 11, 2011, their claim is out of time.

13The defendants claim that the limitation period did not begin to run against them until they were served with the amended statement of claim, i.e. August 10, 2011.

The Legal Framework

a) Summary judgment

14Rule 20.04 provides that the court “shall” grant summary judgment if the court “is satisfied that there is no genuine issue requiring a trial” with respect to a claim or defence. In making that determination, the court shall not only consider the evidence submitted by the parties but may weigh evidence, evaluate credibility or draw reasonable inferences from the evidence, unless in the interests of justice such powers should only be exercised at a trial.

15In the recent case of Combined Air Mechanical Services Inc. v. Flesch, 2011 ONCA 764, at para. 50, the Ontario Court of Appeal clarified the test on summary judgment (the “full appreciation” test):

…In deciding if these powers should be used to weed out a claim as having no chance of success or be used to resolve all or part of an action, the motion judge must ask the following question: can the full appreciation of the evidence and issues that is required to make dispositive findings be achieved by way of summary judgment, or can this full appreciation only be achieved by way of a trial? [emphasis added]

16With respect to the evidence required to apply the “full appreciation” test, the Court must not only look to the motion record but also consider whether beyond that it is necessary to have the benefits of a trial, where she can hear and observe the witnesses (para. 55):

Unless full appreciation of the evidence and issues that is required to make dispositive findings is attainable on the motion record – as may be supplemented by the presentation of oral evidence under rule 20.04(2.2) – the judge cannot be “satisfied” that the issues are appropriately resolved on a motion for summary judgment.

17Significantly, in assessing the record, the “full appreciation test” still requires that “[e]ach side must ‘put its best foot forward’ with respect to the existence or non-existence of material issues to be tried” (para. 56, citing Transamerica Life Insurance Co. of Canada v. Canada Life Assurance Co. (1996), 1996 7979 (ON SC), 28 O.R. (3d) 423 (Gen.Div.) at 434. This obligation continues to apply under the amended Rule 20.

b) Limitation period in slip and fall cases

18Section 4 of the Ontario Limitations Act, 2002 prescribes that a proceeding shall be commenced within two years of the date on which “the claim was discovered.” Section 5 of the Act provides that a claim is “discovered” when someone knew or reasonably ought to have known that he suffered a loss due to the act or omission of another, and that a proceeding was the appropriate way to remedy the loss.

19The case law indicates that in slip and fall actions, the limitation period is triggered when, through reasonable diligence, the plaintiff could identify the defendant in question as potentially liable: Madrid v. Ivanhoe Cambridge Inc. 2010 ONSC 2235; Safai v. Bruce Huntley Contracting Limited 2010 ONCA 545; Higgins v. Barrie (City), [2011] O.J. No. 1598 (S.C.); Wong v. Adler, 2004 8228 (ON SC), [2004] O.J. No. 1575 at para. 45; aff’d. 2004 73251 (ON SCDC), 76 O.R. (3d) 237 (Div.Ct.) As Master Dash stated at para. 15 of Wakelin v. Gourley, 2005 23123 (ON SC), [2005] O.J. No. 2746:

Therefore, as long as the plaintiff puts in evidence as to steps taken to ascertain the identity of the tortfeasors and gives a reasonable explanation on proper evidence as to why such information was not obtainable with due diligence then that will be the end of the enquiry and the defendants will normally be added with leave to plead a limitations defence. This is not a high threshold. If the plaintiff fails to provide any reasonable explanation that could on a generous reading amount to due diligence the motion will be denied. If the plaintiff puts in evidence of steps taken but the proposed defendant also provides evidence of further reasonable steps that the plaintiff could have taken to ascertain the information within the limitation period then the court will have to consider whether the plaintiff’s explanation clearly does not amount to due diligence. If there is any doubt whether the steps taken by the plaintiff could not amount to due diligence then this is an issue that must be resolved on a full evidentiary record at trial or on summary judgment. [emphasis added]

20In Madrid, Lauwers J. (as he then was), observed that it would not be in the interests of justice to impose an “overly muscular” level of pre-discovery due diligence; the parties “should not have to conduct a pre-discovery form of discovery” (para. 15). Whether the steps taken in any particular case are sufficient is to be determined based on the unique context of that case.

21As for claims for contribution and indemnity between tortfeasors, section 18 of the Limitations Act pertains to claims for contribution and indemnity, and provides that such claims are triggered on the day the first alleged wrongdoer “was served with the claim in respect of which contribution and indemnity is sought”.

Submissions and Analysis

22Forest maintains that the plaintiffs “must have” known there was an entity, other than the defendants, that was responsible for the maintenance of the property. Alternatively, they argue that the plaintiffs “could have”, through reasonable inquiries or due diligence, ascertained the identity of Forest.

23In my view, neither submission has merit. The first one, which almost asserts actual knowledge, is not supported by the evidence. The Controller for Forest – S. Persaud – filed an affidavit stating that Forest was first retained to perform maintenance on this property on February 1, 2008. The accident happened less than three weeks later. Persaud claims that in the interim they attended the property on 15 occasions, each time using a truck which clearly identified their name and logo on the outside, and that there was at least one salt bin “at the location” also labelled with their logo. On that basis Forest argues that the plaintiffs must have known Forest was responsible for maintenance.

24That evidence, however, is strongly refuted. The plaintiff Welch deposed that he never saw nor was he made aware of Forest’s presence on the property; he did not see their trucks, and did not see any salt bins until well after the accident. Moreover, the salting records merely indicate that Forest attended in the “AM”; they do not specify when in the “AM” attendances were made, and therefore one cannot speculate whether they coincided with the plaintiffs being present to observe them. Both of the plaintiffs were employed and it is not clear that their daily commute to and from the property would ever have coincided with Forest’s attendances.

25Consequently, there is no reliable evidence to suggest the plaintiffs must have or even should have seen Forest’s presence on the property.

26As for the alternative argument, namely that the plaintiffs could have, through reasonable efforts, identified Forest as the contractor, I also disagree. In this case not only did the defendants fail to mention Forest in the statement of defence or affidavit of documents, but when plaintiff’s counsel specifically enquired of their insurer about “other potential [defendants]” that “should” be sued, ING advised there were “none”. In my view it would have been entirely reasonable for plaintiff’s counsel to accept that reply as correct; if anyone would or should have known about Forest’s existence, it would have been the defendants’ insurer. It was certainly in their interest to point to other potential tortfeasors who could absorb or at least share in any damages that might be awarded.

27Consequently, I reject the defendants’ suggestion that the plaintiffs were obliged to make further inquiries. At the very least there is a material issue that requires a trial, where a decision about the reasonableness of their efforts can be made based on a full record and oral testimony before the trier of fact. This case is very different from Higgins, supra, where the court found that the plaintiff’s motion materials failed to disclose “any” evidence of pre-discovery diligence, and plaintiff’s counsel admitted he made “no inquiries” regarding the identity of other potential defendants prior to examination for discovery (para. 32).

28I take a different view, however, with respect to the cross-claim. In cases involving a claim for contribution and indemnity, a defendant has two years from the date on which it was served with a statement of claim to issue the cross-claim or third party claim: Boutz v. DTE Industries Limited, 2013 ONSC 7085. I agree with Forest that as the defendants were parties to the contract with Forest, they had actual knowledge of Forest’s involvement and therefore the two year limitation period for them runs from September 22, 2009, the day they were served with the statement of claim. It is no answer for them to say they were relying on the plaintiffs to add Forest as a defendant to the main action; from the moment they were served they should have realized, from their own records, that Forest was the contractor at the time, and added Forest as a third party. As the defendants instead waited to serve Forest with the cross-claim until November 11, 2011, their claim is out of time.

Conclusion

29In conclusion, the main claim cannot be resolved on a summary judgment motion, as there is a genuine issue that requires a trial. However, I am satisfied that the full appreciation needed to resolve the cross-claim is available on the motion record. The record clearly establishes that the limitation period commenced no later than September 22, 2009, and therefore the defendants’ cross-claim against Forest is out of time.

30Consequently, Forest’s motion for summary judgment against the plaintiffs is dismissed, but is allowed as against the defendants Peel and Downing.

31As agreed upon by counsel, there shall be no costs payable with respect to the cross-claim. As for the main claim, Forest shall pay costs to the plaintiffs fixed at $7,500, inclusive of GST and disbursements.

Baltman J.

December 10, 2013