SUPERIOR COURT OF JUSTICE - ONTARIO
Court File No.: CV-12-465266
Motion Heard: December 4, 2014
RE: Lynda Faulkner, Brian Faulkner and Amber Cleghorn
v.
James McPhee
Before: Master R.A. Muir
Counsel:
Brian R. Goldfinger for the plaintiffs
Joel Levine for the proposed defendant Attorney General of Canada
REASONS FOR DECISION
[1] The plaintiffs bring this motion pursuant to Rules 5.04(2) and 26.01 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 (the “Rules”) for an order granting them leave to amend their statement of claim to add the Attorney General of Canada as a defendant.
[2] The existing defendant takes no position on this motion. The proposed defendant opposes the relief sought by the plaintiffs.
[3] This action arises out of a motor vehicle accident that took place on June 2, 2011. The plaintiff Lynda Faulkner alleges that she has suffered very serious injuries as a result of the accident.
[4] The defendant was charged with two offences relating to impaired driving. He was ultimately convicted pursuant to one of those charges.
[5] The plaintiffs now seek to add the proposed defendant on the basis of host liability. The proposed defendant is the owner, occupier and liquor licence holder for the Officer’s Mess at the Department of National Defence Staff College located at 215 Yonge Boulevard, Toronto.
[6] The plaintiffs’ proposed amended claim seeks to allege that on the day of the accident the defendant, a member of the Canadian Armed Forces, was drinking at the premises owned by the proposed defendant and that the accident was caused, in part, by the proposed defendant’s negligence in relation to its service of alcohol to the defendant. The plaintiffs allege that they did not learn of the involvement of the proposed defendant until the defendant was examined for discovery on April 30, 2014. The proposed defendant takes the position that the plaintiffs are seeking to add it as a party to an existing action after the expiry of the relevant limitation period.
[7] The plaintiffs argue, however, that the two year limitation period set out in the Limitations Act, 2002, S.O. 2002, c. 24, Sch. B (the “Limitations Act”) has not yet expired based on the doctrine of discoverability. They submit that they only discovered that the proposed defendant may have been partly responsible for the accident when the examination for discovery of the defendant took place in April 2014.
[8] The relevant provisions of the Limitations Act provide as follows:
- In this Act,
“claim” means a claim to remedy an injury, loss or damage that occurred as a result of an act or omission;
Basic limitation period
- Unless this Act provides otherwise, a proceeding shall not be commenced in respect of a claim after the second anniversary of the day on which the claim was discovered.
Discovery
- (1) A claim is discovered on the earlier of,
(a) the day on which the person with the claim first knew,
(i) that the injury, loss or damage had occurred,
(ii) that the injury, loss or damage was caused by or contributed to by an act or omission,
(iii) that the act or omission was that of the person against whom the claim is made, and
(iv) that, having regard to the nature of the injury, loss or damage, a proceeding would be an appropriate means to seek to remedy it; and
(b) the day on which a reasonable person with the abilities and in the circumstances of the person with the claim first ought to have known of the matters referred to in clause (a).
Presumption
(2) A person with a claim shall be presumed to have known of the matters referred to in clause (1) (a) on the day the act or omission on which the claim is based took place, unless the contrary is proved.
[9] Rule 5.04(2) provides as follows:
(2) Adding, Deleting or Substituting Parties - At any stage of a proceeding the court may by order add, delete or substitute a party or correct the name of a party incorrectly named, on such terms as are just, unless prejudice would result that could not be compensated for by costs or an adjournment.
[10] The principles applicable to motions to add parties in circumstances such as those before the court on this motion are set out in the decision of Master Dash in Wong v. Adler, 2004 8228 (ON SC), [2004] O.J. No. 1575 (S.C.J. – Master); affirmed, 2004 73251 (ON SCDC), [2005] O.J. No. 1400 (Div. Ct.).
[11] At paragraph 45 of Wong, Master Dash states as follows:
45 What is the approach a judge or master should take on a motion to add a defendant where the plaintiff wishes to plead that the limitation period has not yet expired because she did not know of and could not with due diligence have discovered the existence of that defendant? In my view, as is clearly implied in Zapfe, the motions court must examine the evidentiary record before it to determine if there is an issue of fact or of credibility on the discoverability allegation, which is a constituent element of the claim. If the court determines that there is such issue, the defendant should be added with leave to plead a limitations defence. If there is no such issue, as for example where the evidence before the motions court clearly indicates that the name of the tortfeasor and the essential facts that make up the cause of action against such tortfeasor, were actually known to the plaintiff or her solicitor more than two years before the motion to amend, the motion should be refused. If the issue is due diligence rather than actual knowledge, this is much more likely to involve issues of credibility requiring a trial or summary judgment motion, provided of course that the plaintiff gives a reasonable explanation on proper evidence as to why such information was not obtainable with due diligence. That is not to say that such motion could never be denied if the evidence is clear and uncontradicted that the plaintiff could have obtained the requisite information with due diligence such that there is no issue of fact or credibility.
[12] It should also be noted that the Court of Appeal has held that the passing of a limitation period is fatal to a motion under Rule 5.04(2). See Joseph v. Paramount Canada's Wonderland, 2008 ONCA 469 at paragraphs 23 and 25. The former doctrine of special circumstances no longer applies. A party cannot be added to an existing action after the expiry of the applicable limitation period.
[13] I have considered and applied these principles to the evidence before me on this motion. I have come to the conclusion that the plaintiffs have met the onus placed upon them to provide a reasonable explanation on proper evidence as to why the information about the proposed defendant’s potential responsibility for the accident was not obtainable prior to the expiry of the presumed limitation period with the exercise of due diligence.
[14] In my view, there was simply no basis for the plaintiffs to make such inquiries into the proposed defendant’s potential responsibility until after the examination for discovery. The police report obtained by the plaintiffs in the summer of 2011 gives no indication as to what the defendant was doing before the accident. It does reveal that he was charged with impaired driving offences but that alone does not automatically suggest third party host liability. This conclusion is reinforced by the fact that the police notes indicate that an empty bottle of 5% alcohol was found in the defendant’s car. The report does not say how large the empty bottle was. The presence of the empty bottle may reasonably suggest that the defendant had supplied his own alcohol or had been drinking at his residence. In my view, there is no general duty on the part of a plaintiff to conduct a wholesale speculative search for potential tortfeasors absent some evidence that would suggest at least the possible involvement of other parties. The record before the court on this motion reveals that there was no such evidence before April 2014.
[15] The proposed defendant placed significant emphasis on the decision of Justice Allen in Sloan v. Sauve Heating Limited, 2010 ONSC 3871 (S.C.J.). In my view, that case is distinguishable from the facts before the court on this motion. In Sloan, the plaintiff contracted with Ultramar Limited (“Ultramar”) for the supply of home heating oil. When Ultramar served its statement of defence in 2006 it indicated that it had sub-contracted the delivery of oil but did not reveal the name of the sub-contractor. In 2009 the plaintiff brought a motion to add the sub-contractors as defendants. The plaintiff in Sloan knew in 2006 that there was a sub-contractor who had delivered the oil but did virtually nothing to determine the name of the sub-contractor for more than three years. For this reason, Justice Allen allowed the appeal from the master and refused to grant leave to add the new defendants. The facts before me are very different. The plaintiffs had no evidence to indicate the potential for host liability until the discovery of the defendant took place. In fact, the evidence they did have would suggest the defendant probably supplied his own alcohol on the day in question. There is simply no evidence of a “triggering event” (using the words of the Court of Appeal) that would have required the plaintiffs to make inquiries until the examination for discovery in April 2014. See Sloan v. Ultramar Limited, 2011 ONCA 91 at paragraph 2.
[16] For these reasons, I am granting the relief requested by the plaintiffs. They shall have leave to amend their statement of claim in the form of the Fresh as Amended Statement of Claim attached to their notice of motion. The proposed defendant shall have leave to plead a limitation defence if so advised.
[17] If the parties are unable to agree on the issue of costs, they may make brief written submissions by no later than December 19, 2014.
Master R.A. Muir
DATE: December 5, 2014