CITATION: Labelle v. Canada Border Services Agency, 2015 ONSC 1943
COURT FILE NO.: CV-09-0596
DATE: 2015-03-25
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
Suzan Labelle and Dennis Labelle,
Mr. L. Scrimshaw, agent for R. Karlstedt, solicitor for the plaintiffs/moving parties
Plaintiffs (Moving Parties)
- and -
Canada Border Services Agency, Attorney General of Canada, Abitibi Consolidated Inc., and International Bridge Company,
Ms. H. Robertson, solicitor for the defendants/responding parties
Defendants (Responding Parties)
HEARD: March 5, 2015,
at Thunder Bay, Ontario
Madam Justice H.M. Pierce
Reasons On Motion To Set Aside Dismissal For Delay
Introduction
[1] The plaintiffs move for an order setting aside the Registrar’s order dated June 27, 2012 which dismissed the plaintiffs’ action for delay. Since this motion was served, the plaintiffs settled their action with the defendants, Abitibi Consolidated Inc., and International Bridge Company; consequently, the plaintiffs withdraw their motion as it applies to those defendants.
[2] The plaintiffs originally claimed against all defendants for damages Suzan Labelle allegedly sustained in a slip and fall at the border crossing plaza in Fort Frances, Ontario. The date of the fall was January 5, 2008.
[3] The defendants, Canada Border Services Agency and the Attorney General of Canada (“the defendants”) oppose the reinstatement of the action on the grounds of delay and prejudice.
Chronology
[4] Part of the defendants’ argument was taken up with counsel’s complaints about the lack of courtesy demonstrated by plaintiffs’ counsel when they set a motion down to be argued or adjourned it without adequate consultation about her availability. This is fair comment. Provided that a client’s interests are not prejudiced, professional courtesy demands that scheduling should be done, as much as possible, cooperatively, in order to find a mutually convenient return date. However, the lack of courtesy displayed does not factor into the issues under consideration on this motion.
[5] In order to understand the issues on this motion, it is helpful to consider the litigation chronology, which is set out below. Although the plaintiffs have settled with the two other defendants, I have included contact between all parties in the chronology so that the history of the litigation may be considered as a whole.
January 5, 2008 Ms. Labelle falls.
April 7, 2008 The defendants are notified in writing of the claim.
April 21, 2008 Abitibi is notified in writing of the claim.
October 8, 2008 International Bridge is notified of the claim.
December 22, 2009 The statement of claim is issued.
March 9, 2010 Abitibi is served with the statement of claim.
March 10, 2010 The defendants are served with the statement of claim; it was missing pages.
March 12, 2010 International Bridge is served with the statement of claim.
March 15, 2010 Counsel for Abitibi and International Bridge advise plaintiffs’ counsel in writing that both defendants are subject to the Companies’ Creditors Arrangement Act in the Superior Court of Quebec, effective April 17, 2009, and that claims against them are stayed pending lifting of the order or leave of the court.
March 16, 2010 The defendants serve a notice of intention to defend.
May 14, 2010 The defendants issue their statement of defence and crossclaim against Abitibi, pleading s. 6 of the Customs Act.
October 24, 2011 The plaintiffs’ assistant telephones to ask for times for examinations for discovery.
October 31, 2011 Plaintiffs’ counsel writes to the defendants asking for dates for discovery.
November 4, 2011 The defendants request a discovery plan before scheduling examinations for discovery. No discovery plan is sent.
March 23, 2012 The court issues a status notice to all parties. It is received by the plaintiffs on March 28, 2012. Counsel for the plaintiffs believes that he instructed his staff to have the matter placed on the status hearing list. It is diarized for June 29, 2012, but through inadvertence, the court is not notified of this request.
April 20, 2012 The defendants leave a message with the assistant for the plaintiffs’ counsel concerning the status notice. Their call is not returned.
May 16, 2012 The defendants again leave a message with the assistant for the plaintiffs’ counsel concerning the status notice. Their call is not returned.
May 22, 2012 The defendants write to the plaintiffs regarding the status notice.
June 23, 2014 The plaintiffs serve a motion returnable July 24, 2014 to set aside the dismissal order. No motion record is served.
June 27, 2012 The Registrar dismisses the action for delay. Notice is received by plaintiffs’ counsel on June 29, 2012, the day that plaintiffs’ counsel believes the matter is on the status hearing list.
July 5 and 6, 2012 Plaintiffs’ counsel attempts to contact the defendants by telephone without success.
July 9, 2012 Plaintiffs’ counsel writes to the defendants seeking consent to set aside the dismissal order and proposing a litigation timetable. A teleconference takes place between plaintiffs’ counsel and the defendants’ counsel. The plaintiffs’ solicitor advises the reason for the delay, and proposes bringing a motion to set aside the dismissal order.
July 9 and 16, 2014 Defendants’ counsel advises that the defendants now oppose reinstatement of the action.
July, 16, 2014 The plaintiffs withdraw their notice of motion.
July 20, 2012 The plaintiffs send medical records to the defendants.
July 26, 2012 At a teleconference between plaintiffs and defendants, a motion to set aside the dismissal order is again proposed.
July 27, 2012 The defendants advise the plaintiffs in writing that they take no position on the case being reinstated.
October 2, 2014 The plaintiffs serve an expanded notice of motion against all defendants, returnable October 30, 2014.
December, 2014 The plaintiffs settle with Abitibi and International Bridge. The defendants are not advised.
February 27, 2015 Canada Border Services is advised that the plaintiffs will not be moving against Abitibi and International Bridge for relief because of the settlement.
March 5, 2015 The motion to set aside the Registrar’s dismissal order is argued.
The Law
[6] Effective January 1, 2015, a plaintiff’s case is not dismissed for delay until it has been outstanding for five years following service of a statement of defence without being set down for trial.
[7] In this case, the previous rule applies. It stipulated that if a defended case was not set down for trial within two years after the first statement of defence was filed, the registrar shall serve on the parties a status notice warning that the action will be dismissed for delay unless, within 90 days after service of the notice, the case was set down for trial, terminated, documents were filed in accordance with subrule (10), or the matter was dealt with at a status hearing. Under the previous rule, if the Registrar dismissed an action for delay under rule 48.14(4), the order could be set aside pursuant to rule 37.14.
[8] The test governing motions to set aside a Registrar’s order were developed in Scaini v. Prochnicki, 2007 ONCA 63; see also Polyakova v. Weiss, 2015 ONSC 1153, para 14.
[9] In Scaini, the court held at paras 23 and 24 that a contextual approach was preferred over a rigid application of the Reid criteria developed in Reid v. Dow Corning Corp. (2001) 11 C.P.C. (5th) 80 at para. 41 (S.C.J.). However, the court observed that the criteria in Reid are “likely to be of central importance in most cases.” It is not mandatory that the plaintiff satisfy all the factors discussed in Reid, set out below:
(1) explain the litigation delay from the institution of the action until the deadline for setting the action down for trial as set out in the status notice;
(2) demonstrate that the plaintiff always intended to set the action down for trial within the time limit in the status notice but failed to do so through inadvertence;
(3) move forthwith to set aside the dismissal order as soon as the order came to her attention; and
(4) show that the defendant will not suffer “any significant prejudice” in presenting its case at trial as a result of the plaintiff’s delay or as a result of steps taken following the dismissal of the action.
[10] In Polyakova, the court held that the Registrar’s order dismissing an action is administrative, not judicial: para. 11. In dismissing an action, the Registrar does not exercise a discretion based upon the circumstances of the case.
[11] Prejudice is often key to deciding whether to set aside the Registrar’s dismissal order. The onus is on the plaintiff to show that the defendant is not prejudiced by an extension of time to set the matter down for trial. However, where the defendant alleges prejudice, there is an “evidentiary obligation to provide some details.” See: Chiarelli v. Wiens, (2000) 2000 CanLII 3904 (ON CA), 46 O.R. (3d) 780 (C.A.), para. 14. The Court of Appeal also noted that the defendant cannot create prejudice by failing to take steps to defend the case, such as interviewing witnesses or conducting surveillance: para. 15.
Discussion
Explanation for the Litigation Delay
[12] The first Reid factor to consider is the plaintiffs’ explanation for the litigation delay.
[13] The plaintiffs rely on Finlay v. Van Paassen, 2010 ONCA 204. In that case, the Court of Appeal reinstated an action even though the plaintiff’s law firm did not move for reinstatement until two years after dismissal. In my view, the Finlay case is distinguishable on its facts.
[14] In Finlay, the male plaintiff was injured in a motor vehicle accident. Before his action was dismissed by the Registrar, pleadings had been exchanged, examinations for discovery completed, and the defendants had served an offer to settle. As well, there was an active companion action instituted by a passenger in the same motor vehicle accident. Both actions had common defendants.
[15] In the companion action there was a counterclaim against Mr. Finlay, seeking contribution in the passenger’s action. The two actions were ordered consolidated. There is no evidence as to why Mr. Finlay’s action was not set down for trial. When his counsel discovered the case had been dismissed, a motion to set aside the Registrar’s order was drafted. Unfortunately, it was never served. Counsel left the law firm and the draft motion languished in Mr. Finlay’s file.
[16] The court in Finlay concluded that there was no prejudice in reinstating the action because the defendants were already defending the companion action involving the passenger.
[17] In the case at bar, counsel for Abitibi and International Bridge wrote to plaintiffs’ counsel immediately upon service of the statement of claim. She advised that because of an order made in the Superior Court of Quebec in April, 2009, both defendants were subject to protection in accordance with the provisions of the Companies’ Creditors Arrangements Act (“CCRA”). Counsel also advised that the plaintiffs’ statement of claim was caught by the provisions of the Quebec order staying proceedings and demanded that the plaintiffs abandon the claim against her clients. Neither Abitibi nor International Bridge served a statement of defence.
[18] Plaintiffs’ counsel did not know what to do about this development. Despite an invitation to speak to Abitibi’s counsel or the court-appointed monitor, he took no steps. Nor did he consult other counsel about the implications of such an order. It appears that he simply put the case aside. There was no communication between plaintiffs’ counsel and counsel for Abitibi and International Bridge from April, 2010 until July, 2014.
[19] Even relating to these defendants, there was little communication and no progress on the file for 1 ½ years. Then the case drifted. The plaintiffs’ counsel drafted an affidavit of documents but never served it. When the defendants requested a discovery plan, he took no steps. Consequently, examinations for discovery were never held. The only significant step after the exchange of pleadings was the Registrar’s dismissal of the action.
Inadvertence in Missing the Deadline
[20] The defendants concede that the plaintiffs have demonstrated inadvertence. I accept that the plaintiffs’ counsel instructed his staff to request that the case be referred to the status review list and although it was diarized, they did not do so.
[21] The court must also consider whether the plaintiff will be without a remedy: Marché d’Alimentation Denis Thériault Ltée v. Giant Tiger Stores Ltd. ONCA 695, para. 28. The court there noted that the law will not ordinarily allow a client to lose their case of action because of his solicitor’s inadvertence. Some courts have determined that a client’s recourse against her solicitor is not a relevant consideration, but in this case, it cannot be ignored. Unfortunately, this case is not purely about inadvertence. There are other factors, such as prejudice, that must be considered in balancing the interests of the parties.
The Motion to Set Aside the Dismissal Order is Brought Promptly
[22] As can be seen from the chronology, the motion to set aside the Registrar’s order was not brought promptly, even though it was discussed with opposing counsel shortly after dismissal. Mr. Scrimshaw candidly admits that this is a weakness in his argument.
[23] When a motion to reinstate the case was first discussed in 2012, defendants’ counsel advised that they would take no position. Still, the plaintiffs did not seize the moment and serve a notice of motion.
[24] About two years after the dismissal and discussions with opposing counsel, the plaintiffs served a motion to reinstate the action. By this time, the defendants opposed reinstatement of the action. Notwithstanding the urgency, the motion was withdrawn.
[25] In October, 2014, some twenty-seven months after the dismissal of the action, the plaintiffs served an expanded notice of motion, seeking to set aside the dismissal order and claiming other relief. That motion was not argued until March 5, 2015, about thirty-two months after the Registrar dismissed the action.
[26] The plaintiffs’ counsel explained that his law firm dissolved in late 2011 and the premises were sold in early 2012, so that he was preoccupied in the summer and fall of 2011 with relocating and setting up his law practice. He opened his new law office on December 1, 2011.
[27] Plaintiffs’ counsel also explained that about a year prior to dissolution of his former law firm, a key staff member left the firm, leaving the lawyers to deal with financial and operational issues, along with the wind-up of the firm.
[28] While these problems were undoubtedly a distraction for plaintiffs’ counsel, all of them predate the Registrar’s notice of pending dismissal and subsequent dismissal order. They do not explain why there was so much delay in bringing a motion to reinstate the case, particularly since counsel was immediately on notice of the dismissal order and faced no opposition by opposing counsel to the action’s reinstatement. I conclude that the real reason that the motion was not brought promptly is that plaintiffs’ counsel did not know what to do about the CCRA order in Quebec.
No Prejudice to the Defendant
[29] The key issue in this case is whether there is prejudice to the defendants. On the facts of this case, I conclude that the defendants will be prejudiced if the dismissal order is set aside.
[30] The defendants crossclaimed against Abitibi when they served their statement of defence. That crossclaim died when the action was dismissed for delay. The defendants are beyond time to make a third party claim against Abitibi and International Bridge.
[31] In their statement of defence, the defendants pleaded s. 6 of the Customs Act, which states:
- (1) The owner or operator of
(a) any international bridge or tunnel, for the use of which a toll or other charge is payable,
(b) any railway operating internationally, or
(c) any airport, wharf or dock that receives conveyances operating internationally and in respect of which a customs office has been designated under section 5
shall provide, equip and maintain free of charge to Her Majesty at or near the bridge, tunnel, railway, airport, wharf or dock adequate buildings, accommodation or other facilities for the proper detention and examination of imported goods or for the proper search of persons by customs officers.
[32] Section (1.1) provides the following clarification:
(1.1) For the purposes of subsection (1), “maintain” means, in addition to performing general maintenance, paying all costs related to the operation of the buildings, accommodation and other facilities, including electricity, lighting, ventilation, heating, cooling, water supply, sewage treatment, fire protection, snow removal and cleaning.
Thus, the defendants enjoy a statutory defence to an Occupier’s Liability action. The defendants say that the responsibility for maintenance of the premises on which Ms. Labelle fell is that of Abitibi, the owner of the land, which is now out of the action. They contend that they are without the remedy of a statutory defence as they are unable to crossclaim against Abitibi.
[33] Further, the defendants submit that their ability to defend themselves rests on the maintenance of the building conducted by its co-defendants. Unfortunately, Abitibi states that its insurer advises that no investigation of Ms. Labelle’s claim was made and no relevant reports remain in the insurer’s file. As well, Abitibi states that it has been unable to locate any maintenance records from the time of Ms. Labelle’s fall or to locate any maintenance employees from that period. The defendants argue that in light of the loss of evidence over time, the prejudice is significant.
[34] I agree. Given the history of delay in the prosecution of this case, the defendants are entitled to some finality. The plaintiffs should not have expected that the defendants’ initial position – not to oppose reinstatement of the action – would continue indefinitely, especially in light of the failure of counsel for the plaintiffs’ to promptly remedy his inadvertence.
[35] I adopt the conclusion of the Court of Appeal at para. 38 of the Marché case:
When an action has been disposed of in favour of a party, that party’s entitlement to rely on the finality principle grows stronger as the years pass. Even when the order dismissing the action was made for delay or default and not on the merits, and even when the party relying on the order could still defend itself despite the delay, it seems to me that at some point the interest in finality must trump the opposite party’s plea for an indulgence. This is especially true where, as in the present case, the opposite party appears to have another remedy available.
[36] The motion to set aside the Registrar’s order dismissing the action is dismissed.
Costs
[37] If the parties cannot agree on costs, either party may apply to the trial coordinator within thirty days for an appointment to argue same, failing which, costs will be deemed to be settled. Costs submissions are not to exceed five pages. Counsel have leave to appear at the costs hearing by teleconference, if so advised.
___”original signed by”
Madam Justice H.M. Pierce
Released: March 25, 2015
CITATION: Labelle v. Canada Border Services Agency, 2015 ONSC 1943
COURT FILE NO.: CV-09-0596
DATE: 2015-03-25
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
Suzan Labelle and Dennis Labelle,
Plaintiffs (Moving Parties)
- and -
Canada Border Services Agency, Attorney General of Canada, Abitibi Consolidated Inc., and International Bridge Company,
Defendants (Responding Parties)
REASONS ON MOTION TO
SET ASIDE DISMISSAL FOR DELAY
Pierce J.
Released: March 25, 2015
/mls