Dupuis v. W.O. Stinson & Son Limited et al.

[Indexed as: Dupuis v. W.O. Stinson & Son Ltd.]

Ontario Reports

Ontario Superior Court of Justice,

Polowin J.

July 23, 2014

122 O.R. (3d) 535 | 2014 ONSC 4317

Case Summary

Civil procedure — Irregularities — Registrar receiving couriered copy of statement of claim and correct fee on last day before limitation period expired — Registrar refusing to issue statement of claim as counsel had not complied with rule requiring attendance in person — Registrar aware of limitation issue but returning statement of claim by mail instead of contacting counsel — Master not erring in granting order nunc pro tunc declaring that statement of claim was issued on day registrar received it — Master correcting irregularity rather than allowing action to be commenced after expiry of limitation period — Defendant not prejudiced by order.

Limitations — Practice and procedure — Registrar receiving couriered copy of statement of claim and correct fee on last day before limitation period expired — Registrar refusing to issue statement of claim as counsel had not complied with rule requiring attendance in person — Registrar aware of limitation issue but returning statement of claim by mail instead of contacting counsel — Master not erring in granting order nunc pro tunc declaring that statement of claim was issued on day registrar received it — Master correcting irregularity rather than allowing action to be commenced after expiry of limitation period — Defendant not prejudiced by order. [page536]

Counsel for the plaintiff sent the statement of claim to the registrar's office by overnight courier on October 31, 2012 along with a letter indicating that the limitation period expired on November 1, 2012. The registrar received the statement of claim and the letter on November 1, but the registrar did not issue the statement of claim as counsel had not complied with rule 4.05(1) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, which requires attendance in person. The registrar returned the statement of claim by mail instead of contacting counsel. The statement of claim was issued on November 7, 2012. The plaintiff applied successfully for an order nunc pro tunc declaring that the statement of claim was issued on November 1, 2012. The defendant appealed.

Held, the appeal should be dismissed.

The master did not err in granting the order. He was correcting an irregularity rather than allowing an action to be commenced after the expiry of the limitation period. The plaintiff was not relying on the special circumstances doctrine. As the master noted, the defendant suffered no prejudice as a result of the order, other than losing the windfall benefit of being able to capitalize on the error made by the plaintiff's counsel.

Joseph v. Paramount Canada's Wonderland (2008), 90 O.R. (3d) 401, [2008] O.J. No. 2339, 2008 ONCA 469, 294 D.L.R. (4th) 141, 56 C.P.C. (6th) 14, 241 O.A.C. 29, 241 O.A.C. 29, 166 A.C.W.S. (3d) 762, distd

Tummillo v. Prouty, [1990] O.J. No. 808, 42 C.P.C. (2d) 308, 20 A.C.W.S. (3d) 1190 (Dist. Ct.), consd

Other cases referred to

Basarsky v. Quinlan, 1971 5 (SCC), [1972] S.C.R. 380, [1971] S.C.J. No. 118, 24 D.L.R. (3d) 720, [1972] 1 W.W.R. 303; Chiarelli v. Wiens (2000), 2000 3904 (ON CA), 46 O.R. (3d) 780, [2000] O.J. No. 296, 129 O.A.C. 129, 43 C.P.C. (4th) 19, 94 A.C.W.S. (3d) 850 (C.A.); Dupuis v. W.O. Stinson & Son Ltd., [2013] O.J. No. 4048, 2013 ONSC 5648 (S.C.J.); Finlay v. Van Paassen (2010), 101 O.R. (3d) 390, [2010] O.J. No. 1097, 2010 ONCA 204, 266 O.A.C. 239, 318 D.L.R. (4th) 686, 188 A.C.W.S. (3d) 675; Habib v. Mucaj, [2012] O.J. No. 5946, 2012 ONCA 880, 31 C.P.C. (7th) 1; Housen v. Nikolaisen, [2002] 2 S.C.R. 235, [2002] S.C.J. No. 31, 2002 SCC 33, 211 D.L.R. (4th) 577, 286 N.R. 1, [2002] 7 W.W.R. 1, J.E. 2002-617, 219 Sask. R. 1, 10 C.C.L.T. (3d) 157, 30 M.P.L.R. (3d) 1, 112 A.C.W.S. (3d) 991; Scaini v. Prochnicki (2007), 85 O.R. (3d) 179, [2007] O.J. No. 299, 2007 ONCA 63, 219 O.A.C. 317, 39 C.P.C. (6th) 1, 154 A.C.W.S. (3d) 1075; Shannon v. Topp, 1986 2946 (SK QB), [1986] S.J. No. 171, [1986] 3 W.W.R. 83, 44 Sask. R. 100, 36 A.C.W.S. (2d) 172 (Q.B.)

Statutes referred to

Courts of Justice Act, R.S.O. 1990, c. C.43, s. 66 [as am.], (3) [as am.]

Limitations Act, 2002, S.O. 2002, c. 24, Sch. B [as am.], s. 20

Rules and regulations referred to

Rules of Civil Procedure, R.R.O. 1990, Reg. 194, rules 1.04, 2.01, (1), (a), 2.03, 4.05(1), 5, 14.08(1), 26

APPEAL by the defendant from an order granting the plaintiff's motion to backdate the issuance of the statement of claim.

A. Charles Gluek, for respondent.

Lisa Langevin, for defendant (Stinson). [page537]

[1] POLOWIN J.: — This is an appeal by the defendant W.O. Stinson & Son Limited ("Stinson") from the order of Master MacLeod dated September 6, 2013 [[2013] O.J. No. 4048, 2013 ONSC 5648 (S.C.J.)], which granted the plaintiff's motion to backdate the issuance of the statement of claim. It is Stinson's position that the master erred in law and in fact in granting the plaintiff's motion for a retroactive order that the claim had been issued on November 1, 2012. In essence, it is Stinson's position that the court's authority to grant orders nunc pro tunc must not conflict with the provisions of an Act, including the Limitations Act, 2002, S.O. 2002, c. 24, Sch. B.

The Factual Background

[2] The claim arose out of a fuel leak which the plaintiff discovered on November 1, 2010. There is no dispute, for the purpose of this appeal, that the limitation period to commence an action with respect to this claim expired on November 1, 2012. On October 31, 2012, the plaintiff's counsel sent the statement of claim by overnight courier from Toronto to the Ottawa court. Attached to the statement of claim was a letter from the plaintiff's counsel addressed to the local registrar at the Ottawa court which advised that three copies of the claim were enclosed along with a cheque in the amount of $181 for filing fees. Plaintiff's counsel asked to be provided with a copy of the issued claim, "once same has been done", and enclosed a stamped, self-addressed envelope for the registrar to return the claim. Also attached to the letter was a sticky note which stated:

The limitation period for filing these is today, November 1, 2012. I would really appreciate if you could call me once these are issued to let me know it's been done.

[3] The documents were received by the Ottawa court on November 1, 2012 at 9:06 a.m., and were opened and date stamped by the court on November 1, 2012. However, the registrar did not issue the statement of claim or contact counsel. Instead, it was mailed back to plaintiff's counsel, along with a photocopy of rule 4.05(1) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 (the "Rules"). Rule 4.05(1) provides that an issuing document may be issued on personal attendance in the court office by the party seeking to issue it or by someone on the party's behalf.

[4] Plaintiff's counsel learned that the statement of claim had not been issued six days later, when the registrar's letter was received. A process server was retained and the statement of claim was issued on November 7, 2012. On November 19, 2012, Ms. Beaulieu appeared before Master MacLeod on a motion, without notice, seeking an order, nunc pro tunc, declaring that the statement of claim was issued on November 1, 2012. Master MacLeod adjourned the motion in order for the defendants to be put on notice and seized himself of the matter.

The Decision of Master MacLeod

[5] The order was granted by Master MacLeod. In fulsome reasons, he determined that a nunc pro tunc order was appropriate. He noted the competing principles at play in the motion. On the one hand, the principle that cases should be decided on their merits rather than on technical compliance with procedural rules. On the other hand, the harsh reality of limitation periods which are designed to ensure that disputes are brought forward in a timely manner or forever put to rest. He also noted that there were no current decisions on point, written in this court, since the enactment of the Limitations Act, 2002.

[6] Master MacLeod stated that this was plainly and simply an error by counsel; however, the evidence supported a finding that there was a good faith effort to issue the process on the correct day. He found that it would have been a simple matter for the registrar to phone, e-mail or fax counsel for the plaintiff and advise that the claims had not been issued, and it would have been a courtesy to do so.

[7] Master MacLeod noted that the overarching purpose of the Rules of Civil Procedure is to provide a framework for the just resolution of civil disputes on their merits as effectively as possible, referring to rule 1.04. He stated that in furtherance of that objective, rule 2.01 clearly stipulates that a failure to comply with the Rules is an irregularity and does not render the step a nullity. Subrule 2.01(1)(a) authorizes a court to grant amendments or other relief as necessary to secure the just determination of "the real matters in dispute". Master MacLeod then noted that the court has broad remedial jurisdiction to cure procedural errors, including the power to backdate the effective date of an order in certain circumstances and to deem an irregular step to comply with the Rules. He recognized, however, that the fundamental question is always whether or not it is just to do so, noting that it is not always appropriate to grant such relief where there are competing circumstances.

[8] Master MacLeod then found the most pertinent principle in this case to be the principle of timelines and finality as expressed in the Limitations Act, 2002. He referred in this regard to Joseph v. Paramount Canada's Wonderland (2008), 90 O.R. (3d) 401, [2008] O.J. No. 2339, 2008 ONCA 469 ("Joseph"). In Joseph, the court held that the Limitations Act, 2002 abolished the court's common law power to allow the addition of parties or new causes of action after the expiry of the limitation period based on the doctrine of special circumstances. He stated that the question to be determined was whether granting the requested order was simply correcting an irregularity or, in reality, allowing an action to be commenced after the expiry of the limitation period, although noting this to be a somewhat circular argument.

[9] Master MacLeod found that there was, in reality, no prejudice to the defendants if the relief was granted other than the windfall benefit of being able to capitalize on the error made by the plaintiff's counsel, noting that compliance with the Limitations Act, 2002 simply requires that the action be started by the second anniversary of the date when the cause of action was discovered. Pursuant to rule 14.08(1), a plaintiff then has up to six months to serve the statement of claim and even that time can be extended.

[10] Master MacLeod further found that the statement of claim and the appropriate fee were delivered to the court office in time. The irregularity was the failure to attend personally to ensure the process was issued and he could discern no policy reason for personal attendance which exists for the benefit of the defendant. He then referred to Tummillo v. Prouty, [1990] O.J. No. 808, 42 C.P.C (2d) 308 (Dist. Ct.) ("Tummillo") and Shannon v. Topp, 1986 2946 (SK QB), [1986] S.J. No. 171, [1986] 3 W.W.R. 83 (Q.B.), which he found of assistance in clarifying that correcting an irregular step taken in time is not the same thing as extending the limitation period. In addition, he rejected the submission of the defence that as this was a clear case of negligence on the part of plaintiff's counsel, the proper approach is to refuse relief and allow a plaintiff to pursue a claim against his law firm. In this regard, he referred to the jurisprudence of the Court of Appeal for Ontario in Chiarelli v. Weins (2000), 2000 3904 (ON CA), 46 O.R. (3d) 780, [2000] O.J. No. 296 (C.A.); Scaini v. Prochnicki (2007), 2007 ONCA 63, 85 O.R. (3d) 179, [2007] O.J. No. 299 (C.A.); Finlay v. Van Paassen (2010), 101 O.R. (3d) 390, [2010] O.J. No. 1097, 2010 ONCA 204; and Habib v. Mucaj, [2012] O.J. No. 5946, 2012 ONCA 880, to the effect that the law will not ordinarily allow a client to suffer the irrevocable loss of a right to proceed by reason of the inadvertence of his or her solicitor. [page540]

[11] Master MacLeod concluded that there was to be an order nunc pro tunc deeming the actions to have been properly commenced on November 1, 2012. He summarized his findings, at para. 25:

In my view the evidence supports a finding that there was a good faith effort to issue the process on the correct day. The Registrar refused to issue the document because of technical non compliance with the rule requiring attendance in person but the originating process and the correct fee were in the Registrar's office on the day in question. The Registrar elected to return the document and the cheque by mail rather than contacting counsel. Though the fault was that of counsel and not of the court, this is an irregularity which can be cured by a corrective order. Under the circumstances the plaintiff should not be put out of court and the defendant granted a windfall that it could not have known about or relied upon.

The Standard of Review

[12] The parties agree that on an appeal from a master's decision, the applicable standard of review is one of correctness with respect to issues of law or legal principles. The standard of review for findings of fact is that such findings cannot be reversed unless there is a palpable and overriding error. Questions of mixed fact and law are on a spectrum. If a legal question can be separated out, it will be reviewed for correctness, but otherwise questions of mixed fact and law will not be overturned absent palpable and overriding error (see Housen v. Nikolaisen, 2002 SCC 33).

Position of Stinson

[13] It is the position of Stinson that the master erred in law in granting the order requested by the plaintiff. It submitted that the court's authority to grant orders nunc pro tunc must not conflict with the provisions of an Act, including the Limitations Act, 2002. Stinson relied on the decision of the Court of Appeal for Ontario in Joseph, which addressed the interplay between the Rules and s. 20 of the Limitations Act, 2002. Section 20 provides that the Limitations Act, 2002 does not affect the extension, suspension or other variation of a limitation period or other time limit by or under another Act. Stinson noted further that the Rules are enacted by the Civil Rules Committee under the authority of s. 66 of the Courts of Justice Act, R.S.O. 1990, c. C.43. However, while the Rules are permitted to alter the substantive law in matters relating to practice and procedure, s. 66(3) of the Courts of Justice Act provides that the Rules must not conflict with an Act. Consequently, it is submitted that, in accordance with s. 66(3) of the Courts of Justice Act, rule 2.03 must not be applied in conflict with the Limitations Act, 2002.

[14] Further, it is submitted that it is implicit in the master's decision that the registrar had, and ought to have exercised, jurisdiction to waive compliance with the Rules in the circumstances of this case. According to Stinson, the master improperly shifted the fault for the non-compliance to the registrar. It is noted in this regard that the registrar does not have jurisdiction to waive a party's compliance with the Rules. Stinson also submitted that there is no evidence that the registrar opened or read the plaintiff's letter before the limitation period expired. Stinson submitted that the master made a palpable and overriding error both in finding that the registrar opened the letter in time to issue the claim and in finding that the registrar was callous in returning the claim to plaintiff's counsel without intervening and/or contacting plaintiff's counsel to alert her to the failure to comply with the Rules.

[15] In addition, Stinson has raised a "floodgates" argument, submitting that if the master's decision is not overturned, it will permit lawyers throughout the province to send claims by fax, e-mail or mail. It is submitted that what occurred in this case was negligence, this was not an "irregularity" and that the master has improperly created a special circumstance.

Determination

[16] Firstly, it is my view that Master MacLeod's order did not imply, in any way, that the registrar had, and ought to have exercised, jurisdiction to waive compliance with the Rules in the circumstances of this case. While he indicated that it would have been a simple matter for the registrar to contact the plaintiff by phone, e-mail or fax to advise that the claims had not been issued and it would have been a courtesy to do so, Master MacLeod was clear that there was no technical or legal obligation on the court staff to do so. Master MacLeod found no error on the part of the court staff, stating that the error was plainly and simply an error of counsel. He noted that courts administration should not be expected to assume the responsibility of ensuring that documents simply delivered or left at the court house get to the right office and are issued on the right day. He also stated, at para. 21, that he could not find that the registrar was technically in error in not accepting that responsibility, or in enforcing the rule and mailing it back, knowing the limitation period would have expired by the time counsel knew about it, although he viewed such action as callous. Nowhere in his reasons does Master MacLeod state, or imply, that the registrar had jurisdiction to waive compliance with the rule, or ought to have exercised jurisdiction to do so. Master MacLeod may have viewed the court staff's action as harsh and that a simple heads-up could have been provided to counsel on November 1, but he in no way found the court staff's action to be wrong.

[17] Stinson has also submitted that there was no evidence before the court that the registrar even saw and opened the letter on November 1, 2012. According to counsel, it may have only been received in the "mail room" of the court house on November 1, 2012. Counsel pointed to the affidavit of Jillian K. Beaulieu, dated February 26, 2013, where it is stated that the documents were received in the Ottawa court on November 1, 2012 at 9:06 a.m. However, attached to this affidavit is a copy of the courier's confirmation form. It is indicated on that form that the documents were to be delivered to the local registrar and that the documents were delivered by 11/1/2012 09:06 (emphasis added). In my view, there was evidence before Master MacLeod on which he could conclude, as he did, that the materials arrived in the office of the registrar early in the morning of November 1, 2012. The master made no palpable or overriding error with respect to this finding.

[18] Stinson has also made a "floodgates" argument. In Tummillo, in 1990, Justice Kozak granted an order similar to that requested herein. No Ontario case was found by either counsel since 1990 where the issue was again raised. The floodgates did not open with Tummillo, and it is most doubtful that they would open now. A counsel who makes such error would have to bring a costly motion to convince a court to exercise its jurisdiction. The disincentive to making such an error is obvious.

[19] Stinson relied heavily in its submissions on the Court of Appeal decision in Joseph. However, the issue in Joseph was whether courts continue to have discretion under the Limitation Act, 2002 to extend a limitation period and allow a claim to be commenced after the period has expired by applying the doctrine of special circumstances. The court stated that the doctrine of special circumstance originated in Canadian jurisprudence in Basarsky v. Quinlan, 1971 5 (SCC), [1972] S.C.R. 380, [1971] S.C.J. No. 118, where the plaintiff brought a claim within the applicable limitation period, but later sought to add a new claim after the period had expired. The court then stated that this common law doctrine gradually came to be applied to motions brought under Rule 26 and Rule 5 to amend pleadings or add parties after the expiry of a limitation period. [page543] It noted that neither Rule 26 nor Rule 5 refers specifically to the expiry of a limitation period or to the doctrine of special circumstances. However, it found that since Basarsky v. Quinlan, these rules have been interpreted to allow a court to add or substitute a party or to add a cause of action after the expiry of a limitation period where special circumstances exist, unless the change would cause prejudice that could not be compensated for with either costs or an adjournment.

[20] The court then determined, as a matter of statutory interpretation, that the legislature did not intend to preserve the court's common law discretion to extend limitation periods under the Limitations Act, 2002 by applying the doctrine of special circumstances. The essence of the court's decision is set out in Joseph, at paras. 21-25:

Turning to the interpretation of s. 20 in the context of the common law doctrine of special circumstances, the requirement in s. 20 that the extension must be "by or under another Act" clearly precludes any extension that may be granted at common law as opposed to statute.

However, the extension need not be provided only "by" an Act but can also be provided "under" an Act. The Rules of Civil Procedure are enacted by the Civil Rules Committee under the authority of s. 66 of the Courts of Justice Act, R.S.O. 1990, c. C.43. Although the Rules are permitted to alter the substantive law in matters relating to practice and procedure, s. 66(3) provides that the Rules may not conflict with an Act.

In accordance with s. 66(3), rules 5.04 and 26.01 must not conflict with the new Act, or with the former Act. These rules apply to the amendment of pleadings and the addition of parties at any stage of proceedings. They do not by their terms apply to extend the statutory limitation periods provided in the new Act, nor could they. But they have been used for that purpose through the application of the common law doctrine of special circumstances.

Because the Rules themselves are authorized to be made by the Courts of Justice Act, they are arguably made "under another Act". However, it is only the interpretation of the Rules by application of the common law that has incorporated the doctrine of special circumstances to extend limitation periods by adding parties or claims after the expiry of a limitation period. The Rules themselves do not do this. In my view, it would be extending the meaning of "under another Act" too far to interpret it as including the application of common law principles used to apply the Rules, even though the Rules themselves are made by regulation "under another Act".

I am reinforced in my view by s. 21 of the new Act, which specifically prohibits the addition of parties to an existing action after the expiry of the limitation period. Section 20 would conflict with s. 21 if it were interpreted to extend to the incorporation of the common law special circumstances doctrine, thereby allowing the possible addition of parties after the expiry of the limitation period where special circumstances exist, in conflict with s. 21. [page544]

[21] In Joseph, counsel had intended to issue the claim within the limitation period but his assistant, believing that the six-year limitation period still applied, did not have it issued before leaving on her holidays. When the error was discovered, the claim was issued, almost two months after the expiry of the limitation period. In Joseph, there was no irregularity to cure. The claim did not reach the court office within the required limitation period. Joseph does not engage the particular issue with which this court is faced and Master MacLeod properly distinguished Joseph from the case at hand. Rule 2.01(1) specifically provides that the failure to comply with the Rules is an irregularity from which the court may relieve. There is no reliance here on the doctrine of special circumstances.

[22] I do not intend to repeat the reasoning of Master MacLeod. In his fulsome reasons, he noted the applicable Rules and the provisions of the Limitations Act, 2002. He thoroughly reviewed the case law and acknowledged, and considered the competing principles and policy concerns. I can find no error in his findings or in his application of the law. I adopt his reasoning and dismiss the appeal.

[23] I did not hear from the parties with respect to costs. If the parties are unable to agree on costs, they are to provide brief written costs submissions, including a costs outline. The plaintiff is to provide its submissions to the court by August 13, 2014. Stinson is to reply by September 3, 2014.

[24] Finally, I wish to thank counsel for their thoughtful and helpful submissions in this very interesting matter.

Appeal dismissed.

End of Document