COURT FILE AND PARTIES

COURT FILE NO.: 04-CV-272398

DATE: 2013/12/16

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: PDI PHARMACEUTICALS, INC., Plaintiff

AND:

CHEMI S.P.A., Defendant

BEFORE: Master Ronna Marie Brott

COUNSEL:
William G. Scott, Counsel for the Plaintiff

Daniel S. Murdoch, Counsel, for the Defendant

HEARD: November 14, 2013

ENDORSEMENT

[1] The plaintiff brings the within motion to restore this action to the trial list pursuant to Rule 48.11.

[2] The plaintiff acted as an agent for the defendant in the sale of pharmaceutical ingredients. The action arises as a result of the alleged termination of the plaintiff’s unwritten agency agreement with the defendant in or about June to October 2003.

Chronology of the Action

July 14, 2004

Statement of Claim (“Claim”) issued

September 2, 2004

Claim served at defendant’s head office in Italy

November 12, 2004

Statement of Defence and Counterclaim delivered

November 17, 2004

Reply and Defence to Counterclaim delivered

November 26, 2004

Defendant delivered a Demand for Particulars

January 18, 2005,

February 8, 2005

March 8, 2005

Responses to Demand for Particulars

March 16, 2005

Reply to Defence to Counterclaim delivered

April 5, 2005

Plaintiff delivered unsworn Affidavit of Documents

April 13, 2005

Mediation

May 3, 2005

Plaintiff delivered further unsworn Affidavit of Documents

June 21, 2005

Plaintiff delivered sworn copy of Further Affidavit of documents

June 27, 2005

Plaintiff’s counsel wrote to Trial Coordinator advising that action was not ready to set trial date at Trial Scheduling Court scheduled for June 29, 2005, and requested that action be struck from the trial list.

July 20, 2005

Defendant delivered sworn Affidavit of Documents

October 12, 2005

Defendant delivered a further Affidavit of Documents

August 2005–April 2006

Examinations for discovery of all parties. The continuation of the plaintiff’s examination for discovery was adjourned pending the receipt of answers to undertakings.

February 8, 2006

Plaintiff set the action down for trial by serving a Trial Record.

April 10, 2006

Trial Coordinator emailed a Trial Certification Form to counsel which stated, inter alia: “You are requested to discuss the matter with each other and complete it on a joint basis and return it to me within the next month.”

May 8, 2006

Counsel for the parties conferred about the information to be submitted on the Trial Certification Form

July 26, 27, 2006

Further discovery of the plaintiff was adjourned as the plaintiff had not answered undertakings

January 10, 2007

The action was struck from the trial list by the Trial Coordinator as the Trial Certification From was not submitted. Neither party received notice that the action had been struck from the list.

February 2007

The plaintiff delivered a Third Further Affidavit of Documents and answered the undertakings and refusals chart.

March 5, 2007

Plaintiff’s counsel wrote to defence counsel to inquire about requisitioning trial dates.

March 19, 2007

Defence counsel responded, expressing concern with scheduling trial dates as the plaintiff’s undertakings remained unanswered

August 2011

Plaintiff’s counsel learned that the action had been struck from the list.

December 29, 2011

Plaintiff’s counsel wrote to the Trial Coordinator to request a “To be Spoken To Court”

January 3, 2012

Trial Coordinator advised that if an action was struck from the list, an Order was required to have it restored.

January 9, 2012

Defence counsel advised plaintiff’s counsel that they did not have instructions to restore action to the trial list.

March 27, 2012

The within motion to restore the action to the trial list was served.

November 28, 2012

On consent, the original date for the hearing of this motion was adjourned (on two occasions) pending the release of a series of decisions by the Ontario Court of Appeal which were to address the appropriate test for returning an action to the trial list.

Jurisdiction

[3] The plaintiff asserts that the action should be restored to the trial list as of right as the Court had no jurisdiction to strike the action from the Trial list and further, because it did so without notice to counsel.

[4] Section 76(1) of the Courts of Justice Act grants the Regional Senior Justice the ability to supervise and direct the trial list. Rules 48.10 and 48.11 contemplate actions being removed from the trial list and they do not reference that notice must be given to counsel and/or to the parties prior to an action being struck. If a plaintiff individually or through counsel fails to file a Trial Certification Form, the Trial Coordinator, on direction from the Regional Senior Justice, has jurisdiction to strike an action from the trial list.

The Test to Restore an Action to the Trial List

[5] The Court of Appeal in Nissar v Toronto Transit Commission, 2013 ONCA 361 and Faris v Eftimovski, 2013 ONCA 360 recently revisited the legal test to restore an action to the trial list. It held that the onus is on the plaintiff to prove that there is both an acceptable explanation for the delay and that allowing the action to proceed would not result in any non-compensable prejudice to the defendant.

Acceptable Explanation

[6] The only evidence filed by the plaintiff on this motion is an Affidavit of the solicitor for the Plaintiff with carriage of the action up to the time that this motion was brought.

[7] There is no question that the parties, through their counsel, conferred about the Trial Certification Form in May 2006. However, there is conflicting evidence of the events immediately thereafter. Plaintiff’s counsel asserts that even though he conferred with defence counsel, he did not submit the Trial Certification Form because defence counsel did not want to do so until after the discovery process was complete. Defence counsel’s evidence is that she had provided sufficient information to plaintiff’s counsel to permit him to complete the Trial Certification Form. A review of the correspondence reveals that it was only on March 19, 2007 that defence counsel expressed concern with scheduling trial dates. I find that the defendant had in fact provided sufficient information which certainly would have permitted plaintiff’s counsel to send back the Trial Certification Form to the Trial Coordinator duly executed and he failed to do so.

[8] The plaintiff has offered no explanation for the delay for the period from March 2007 when plaintiff’s counsel requested trial dates from defence counsel, to May 2009. In May 2009 the plaintiff’s representative asked his counsel about court dates and apparently considered possibly stalling the action. It is plaintiff’s counsel’s evidence that in May 2009 he was reluctant to obtain a trial date because the trial would be vigorously defended and the litigation would be lengthy and expensive. He was also concerned about how the plaintiff would cover the cost of the litigation, and about obtaining cooperation from two of the plaintiff’s witnesses. Further, plaintiff’s counsel’s evidence is that he hoped that the action would settle as the plaintiff’s representative had briefly and informally chatted with a representative of the defendant in 2008. There was a further unexplained delay from May 2009 to August 2011 at which time the plaintiff learned that the action had been struck from the trial list.

[9] One of the leading cases for an analysis of what constitutes the adequacy of a plaintiff’s explanation for delay is Marché d’Alimentation Denis Thériault Ltée v Giant Tiger Stores Ltd. (2007), 2007 ONCA 695, 87 O.R. (3d) 660 (ONCA) (“Giant Tiger”). In that case, which analyzed the test to set aside an administrative dismissal (now the same test under Rule 48.11 to return an action to the trial list), the court found that a “deliberate intention not to advance the litigation towards trial” is an inadequate explanation for delay.

[10] In the case at bar, the length of the delay and the lack of an adequate explanation from 2007-2011 appears to be a deliberate intention to hold the file in abeyance. As Master Graham noted in Kerr v CIBC World Markets Inc., 2012 ONSC 3982, it was reasonable to infer that a period of over 4.5 years of inactivity at some point became intentional.

[11] On the facts I find that the delay by plaintiff’s counsel was deliberate. However, even if it was not, counsel’s inactivity amounts to neglect without adequate explanation. Basically the action was dormant from 2007 until counsel learned that the action had been struck from the list in 2011. Over that four (plus) year period, the plaintiff’s evidence fails to provide adequate explanation of the delay.

Rebutting the Presumption of Prejudice

[12] The plaintiff has adduced no evidence on the issue of prejudice. The only evidence by the plaintiff on this motion was through its counsel. There is no evidence from any possible witnesses and given that the action arises from an allegedly unwritten agency agreement, the witnesses’ testimony will be critical. It has now been ten years since the alleged agreement was entered into and the delay itself is prejudicial as unquestionably the memories of the witnesses has faded.

[13] In my view, the plaintiff has failed to rebut the presumption of prejudice.

[14] Because the Court of Appeal in Nissar and Faris, supra, established that the test under Rule 48.11 to restore an action to the trial list is conjunctive and requires the plaintiff to prove both aspects of the test, and I have found that the plaintiff has been unable to prove either part of the test, the plaintiff’s motion is hereby dismissed.

Costs

[15] In the event that the parties cannot agree on the issue of costs they shall, within 60 days, submit brief (1-2 page) written submissions together with costs outlines.

MASTER RONNA M. BROTT

Date: December 16, 2013