SUPERIOR COURT OF JUSTICE - ONTARIO

COURT FILE NO.: CV-10-400562
MOTION HEARD: MARCH 5, 2014

RE: Peter Black, Geordie Brown and PCF Acquisition Corp.

v.

John McDonald

BEFORE: MASTER R.A. MUIR

COUNSEL: Khalid Janmohamed for the plaintiffs
John McDonald, barrister and solicitor, appearing in person

REASONS FOR DECISION

[1] The plaintiffs bring this motion for an order varying the order of Master Brott of March 8, 2013 and my order of June 20, 2013 and extending the date by which this action must be set down for trial. The orders in issue required the plaintiffs to set this action down for trial by September 30, 2013. Although the plaintiffs failed to meet this deadline, this action has not been dismissed by the registrar pending the outcome of this motion.

[2] The defendant opposes the granting of the relief requested on this motion and brings a cross-motion for an order dismissing the plaintiffs’ action pursuant to Rule 48.14(5) due to the non-compliance with my order and Master Brott’s order. The defendant also included relief in the nature of costs against the plaintiffs’ lawyer personally but abandoned that relief during the course of argument. The defendant agreed that any such motion should be brought as a separate motion after I have ruled on the two substantive motions.

[3] This is a professional negligence claim. The defendant is a lawyer practicing in Cambridge, Ontario. He acted for the plaintiffs in connection with a professional negligence claim against Gowling LaFleur Henderson LLP (“Gowlings”). That claim was heard by Justice Mesbur over 20 days in early 2008. On April 30, 2008 Justice Mesbur dismissed the plaintiffs’ action against Gowlings.

[4] On April 7, 2010, the plaintiffs commenced this action against the defendant alleging negligence in connection with his handling of the plaintiffs’ claim against Gowlings. The defendant denies the plaintiffs’ allegations.

[5] The parties disagree with respect to the test to be applied on this motion. The plaintiffs argue that the test applicable to setting aside an administrative dismissal order should be applied. The defendant argues that a stricter test similar to the test on a contested status hearing should be applied. That test is conjunctive and requires a plaintiff to explain the delay with the litigation and demonstrate that the defendant will not be prejudiced in presenting his case at trial. In my view, it does not matter which test applies as I have concluded that the plaintiffs have met all applicable factors and the relief requested should be granted.

[6] On a motion to set aside an administrative dismissal, the court will typically look at four central factors. These are the so-called Reid factors[^1] endorsed by the Court of Appeal in Marché D’Alimentation Denis Thériault Lteé v. Giant Tiger Stores Ltd., 2007 ONCA 695, [2007] O.J. No. 3872 (C.A.) and other decisions. Those factors can be summarized as follows:

(1) Explanation of the Litigation Delay: The plaintiff must adequately explain the delay in the progress of the litigation from the institution of the action until the deadline for setting the action down for trial as set out in the status notice. She must satisfy the court that steps were being taken to advance the litigation toward trial, or if such steps were not taken to explain why.... If either the solicitor or the client made a deliberate decision not to advance the litigation toward trial then the motion to set aside the dismissal will fail.

(2) Inadvertence in Missing the Deadline: The plaintiff or her solicitor must lead satisfactory evidence to explain that they always intended to set the action down within the time limit set out in the status notice, or request a status hearing, but failed to do so through inadvertence. In other words the penultimate dismissal order was made as a result of inadvertence.

(3) The Motion is Brought Promptly: The plaintiff must demonstrate that she moved forthwith to set aside the dismissal order as soon as the order came to her attention.

(4) No Prejudice to the Defendant: The plaintiff must convince the court that the defendants have not demonstrated any significant prejudice in presenting their case at trial as a result of the plaintiff’s delay or as a result of steps taken following the dismissal of the action.

[7] I am satisfied that this motion has been brought in a timely manner. The plaintiffs advised the court of their intention to bring this motion five weeks after the deadline in a conference call with me on November 6, 2013. Their motion record was served on December 2, 2013 and was made returnable on March 5, 2014, which was my first available long motion hearing date. In my view, this motion has been brought promptly.

[8] I am also satisfied that the overall delay to date has been satisfactorily explained. Initially, this action moved quite quickly. The exchange of productions and discovery of the defendant were all completed by September 29, 2010.

[9] The plaintiffs then brought a motion to add the defendant’s law partner as a defendant. That motion was dismissed by Master Haberman on January 10, 2011. The issue of the costs of that motion took a considerable period of time to deal with as the defendant sought and received a costs order against the plaintiffs’ lawyer. Master Haberman’s orders were appealed to the Divisional Court. The appeals were dismissed on April 10, 2012.

[10] There appears to be some unexplained delay between April 2012 and January 2013 when the plaintiffs filed a requisition for a status hearing. The status hearing took place on consent and in writing before Master Brott on March 8, 2013. Master Brott’s order established the set down deadline of September 30, 2013. That date was confirmed by me in my endorsement of June 20, 2013.

[11] I see no undue delay in the progress of this action. It is less than four years old and most of the delay to date can be explained by the extended time required to deal with the motion to amend and its costs consequences. The plaintiffs are prepared to set this action down for trial within two weeks. The only unexplained delay was relatively short in duration. I accept the plaintiffs’ explanations for the overall delay with this action.

[12] I am also satisfied that the September 30, 2013 deadline was missed due to inadvertence. Mr. Adair’s unchallenged evidence is that he was reorganizing his practice and busy with other significant matters between June and September 2013.This matter simply fell through the cracks. Mr. Adair took steps to address the default shortly after the deadline had passed. The plaintiffs have satisfied this element of the test.

[13] Finally, I see no prejudice to the defendant as a result of the delay. Documents have been preserved and exchanged. The defendant has been examined for discovery. The plaintiffs are available to be examined should the defendant choose to do so. It is true that memories fade over time, however, there is no specific evidence of witnesses who cannot be located or who are otherwise unavailable or unable to give evidence.

[14] The defendant’s responding material deals extensively with the merits of his defence and various irregularities with the plaintiffs’ action. I agree that there may be concerns relating to the bankruptcy of the plaintiff Geordie Brown and in relation to his assignment of his rights in July 2009. I also note that the plaintiffs failed to obtain an order to continue following Mr. Brown’s assignment in bankruptcy in 2010. However, I do not view those issues as relevant to this motion. Those are matters to be determined at trial or on a separate motion.

[15] Similarly, I do not view the allegations of past improper conduct on the part of the plaintiffs and their lawyers as particularly relevant. The motion to amend may have been misguided and ill-conceived but that matter has been dealt with and the costs orders have been paid. The failure to obtain an order to continue was an irregularity but Mr. Brown and his trustee have now both been discharged. The issues surrounding the assignment by Mr. Brown need to be explored in more detail before any conclusions can be drawn.

[16] I have therefore concluded that it is just that an order be made extending the set down deadline as requested by the plaintiffs. The defendant’s motion to dismiss this action is dismissed.

[17] The plaintiffs have been entirely successful and would ordinarily be entitled to costs. However, the plaintiffs have received an indulgence from the court. They failed to meet the September 30, 2013 deadline despite having expressly consented to meeting that date. While I have accepted Mr. Adair’s explanations for failing to do so, the fact remains that the plaintiffs failed to comply with an order of the court of which they were fully aware. I do not view the defendant’s opposition to this motion as unreasonable in the circumstances. In my view, it is fair and reasonable that there be no order with respect to the costs of either motion.

[18] I therefore order as follows:

(a) the order of Master Brott of March 8, 2013 and my order of June 20, 2013 are hereby varied to extend the date by which this action must be set down for trial to March 20, 2014;

(b) the plaintiffs shall have leave to set this action down for trial notwithstanding the non-compliance with the mediation requirements of Rule 24.1;

(c) mediation shall take place by September 30, 2014;

(d) the defendant’s motion is dismissed; and,

(e) there shall be no order with respect to the costs of either motion.

Master R.A. Muir

DATE: March 6, 2014

[^1]: Reid v. Dow Corning Corp., [2001] O.J. No. 2365 (S.C.J. – Master), reversed on other grounds [2002] O.J. No. 3414 (Div. Ct.).