CITATION: Goodman and Doyon v. LawPRO et al, 2015 ONSC 2460
BELLEVILLE COURT FILE NO.: CV-12-0294-00
DATE: 20150415
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: David Stewart Goodman and Jeannette Doyon, Plaintiffs
AND
Graham Curtis Shannon, Janet Marie Shannon, Carson Dunlop & Associates Ltd., Gordon Mathieu, Lawyer’s Professional Indemnity Company and The Corporation of the County of Prince Edward, Defendants
BEFORE: Madam Justice A. Trousdale
COUNSEL: S. Daniel Baldwin for the Plaintiffs David Stewart Goodman and Jeannette Doyon
John Rowinski, for the Defendant Lawyer’s Professional Indemnity Company
HEARD: March 31, 2015
ENDORSEMENT
Trousdale J.
Nature of the Hearing/Issue
[1] This was a motion by the Defendant, Lawyer’s Professional Indemnity Company (“LawPRO”) against the Plaintiffs, David Stewart Goodman and Jeanette Doyon, to enforce a purported settlement pursuant to Rule 49.09 of the Rules of Civil Procedure whereby the action brought by the Plaintiffs against LawPRO and all related crossclaims against and by LawPRO would be dismissed without costs.
[2] The Plaintiffs defend this motion on the grounds that LawPRO did not unconditionally accept the Plaintiffs’ Rule 49 offer to settle, but rather made a counter offer which was not accepted by the Plaintiffs. In addition, the Plaintiffs argue that the conditions upon which that counter-offer was made were never fulfilled as neither the Plaintiffs nor the other Defendants executed the release required by LawPRO. Further, the Plaintiffs withdrew their offer to settle prior to LawPRO accepting it. The Plaintiffs also complain about the content of the release.
[3] The other Defendants did not participate in this motion.
Backgound Facts
[4] The Plaintiffs purchased a home in 2010 in Prince Edward County. They purchased a title insurance policy from LawPRO.
[5] The Plaintiffs claim that there are various defects and Building Code violations in the home. They have commenced this claim against the vendors, the consulting engineering firm and its professional engineer who inspected the home prior to the Plaintiffs waiving their conditions, and against the Corporation of the County of Prince Edward.
[6] The Plaintiffs also claimed against LawPRO for indemnification of losses due to alleged Building Code violations in the home.
[7] LawPRO cross-claimed against the other aforesaid Defendants in the action. All but the vendors cross-claimed against LawPRO.
[8] After examinations for discovery, counsel for the Plaintiffs made a Rule 49 offer to settle to Counsel for LawPRO dated November 11, 2014 in which the Plaintiffs offered a without costs dismissal of the Plaintiffs’ claim against LawPRO.
[9] By letter of November 12, 2014, LawPRO’s counsel advised the Plaintiffs’ counsel that he had presented the offer to his client for instructions and would advise as soon as he received those instructions. He went on to say that if the offer was accepted, LawPRO would require that the Plaintiffs and all cross-claiming defendants sign a release in the standard LawPRO form.
[10] By letter of November 17, 2014 to the Plaintiffs’counsel and copied to counsel for the other Defendants, counsel for LawPRO wrote as follows:
“I am following up on our November 12, 2014 exchange of correspondence.
My client has instructed me to accept your clients’ offer of dismissal of the action without costs. As I indicated in my previous letter, this acceptance is contingent on all parties with claims against LawPRO, including crossclaims, executing the attached release. Accordingly, I have copied all lawyers with releases for their clients. It will of course be your responsibility to take out the dismissal order.
I look forward to everyone’s timely responses.”
[11] By letter of January 9, 2015, counsel for the Corporation of the County of Prince Edward agreed to a dismissal of its crossclaim against LawPRO without costs on the basis of the Plaintiffs’ agreement to dismiss their claim against LawPRO. Counsel went on to advise that her client’s release would be provided upon receipt of a copy of the consent and draft order signed by the Plaintiffs.
[12] On February 5, 2015, counsel for the Plaintiffs, who was new counsel for the Plaintiffs but from the same firm as the Plaintiffs’ prior counsel, had a telephone conversation and an email exchange with LawPRO’s counsel in which the Plaintiffs’ counsel gave written notice of withdrawal of the Plaintiffs’ Rule 49 offer to settle dated November 11, 2014 in accordance with Rule 49.04.
[13] On March 10, 2015, counsel for the consulting engineering firm and for its professional engineer sent an email to counsel for LawPRO advising that his clients would not be able to provide a Release but would consent to the dismissal of the cross-claim against LawPRO on a without costs basis.
[14] On March 11, 2015 counsel for LawPRO brought this motion for a declaration that there is a binding settlement with respect to all of the within proceedings involving LawPRO, and for an order that this action, and all related crossclaims be dismissed as against and by LawPRO.
The Law
[15] Extracts from Rule 49 which are relevant to this matter are as follows:
WHERE AVAILABLE
49.02 (1) A party to a proceeding may serve on any other party an offer to settle any one or more of the claims in the proceeding on the terms specified in the offer to settle (Form 49A). R.R.O. 1990, Reg. 194, r. 49.02 (1).
WITHDRAWAL OR EXPIRY OF OFFER
Withdrawal
49.04 (1) An offer to settle may be withdrawn at any time before it is accepted by serving written notice of withdrawal of the offer on the party to whom the offer was made. R.R.O. 1990, Reg. 194, r. 49.04 (1).
EFFECT OF OFFER
49.05 An offer to settle shall be deemed to be an offer of compromise made without prejudice. R.R.O. 1990, Reg. 194, r. 49.05; O. Reg. 132/04, s. 11.
ACCEPTANCE OF OFFER
Generally
49.07 (1) An offer to settle may be accepted by serving an acceptance of offer (Form 49C) on the party who made the offer, at any time before it is withdrawn or the court disposes of the claim in respect of which it is made. R.R.O. 1990, Reg. 194, r. 49.07 (1).
(2) Where a party to whom an offer to settle is made rejects the offer or responds with a counter-offer that is not accepted, the party may thereafter accept the original offer to settle, unless it has been withdrawn or the court has disposed of the claim in respect of which it was made. R.R.O. 1990, Reg. 194, r. 49.07 (2).
Incorporating into Judgment
(6) Where an offer is accepted, the court may incorporate any of its terms into a judgment. R.R.O. 1990, Reg. 194, r. 49.07 (6).
FAILURE TO COMPLY WITH ACCEPTED OFFER
49.09 Where a party to an accepted offer to settle fails to comply with the terms of the offer, the other party may,
(a) make a motion to a judge for judgment in the terms of the accepted offer, and the judge may grant judgment accordingly; or
(b) continue the proceeding as if there had been no accepted offer to settle.
[16] A purported acceptance of an offer to settle which acceptance contains any qualification or additional condition except as provided for in Rule 49.07 (4) (Payment into Court or to Trustee as a Condition of Acceptance), constitutes a counter-offer. See Desanto v. Cretzman (1986), 1986 CanLII 2663 (ON SC), 53 O.R. (2d) 732, 8 C.P.C. (2d) 191 (Dist. Ct.) and 459853 Ont. Ltd. v. Ameristar Properties Inc. (1986), 12 C.P.C. (2d) 213 (Ont. Dist. Ct.).
Analysis
[17] I find that on November 11, 2014 the Plaintiffs did make a Rule 49 offer to settle this matter as against LawPRO on the basis of a dismissal of their claim against LawPRO without costs.
[18] On November 13, 2014 LawPRO purported to accept the Plaintiffs’ offer, but the acceptance was stated to be contingent on all parties with claims against LawPRO, including crossclaims, executing the releases enclosed in the letter.
[19] I find that the Plaintiffs and LawPRO were not in agreement on all of the terms of settlement. The addition by LawPRO of the condition that all the other parties who had claims, including crossclaims, against LawPRO must execute a release of LawPRO was a term that was not included in the Plaintiffs’ offer to settle. I find that LawPRO’s acceptance of the Plaintiffs’ offer to settle subject to the contingency regarding the cross-claims of the other parties to the proceeding, was not an unqualified and unconditional acceptance of the Plaintiffs’ offer by LawPRO. I find that the addition of that condition constituted a counter-offer by LawPRO to the Plaintiffs.
[20] I find that the Plaintiffs never accepted LawPRO’s counter offer made on November 13, 2014. I find that the Plaintiffs withdrew their Section 49 offer to settle on February 5, 2015 pursuant to Rule 49.04, and that LawPRO had not accepted the Plaintiffs’ Rule 49 offer to settle made on November 11, 2014 by the date of withdrawal of the offer.
[21] Accordingly, I find that there was no accepted offer to settle or counter-offer to settle, that the Plaintffs’ offer to settle was withdrawn prior to its acceptance, and that LawPRO is not entitled to a declaration that there was a binding settlement.
Decision
[22] The motion by LawPRO for a declaration that there was a binding settlement is therefore dismissed.
Costs
[23] At the end of the hearing of this motion, LawPRO’s counsel and the Plaintiffs’ counsel each provided me with a Costs Outline in order to determine the issue of costs in accordance with the results of the motion.
[24] If LawPRO were successful on this motion, LawPRO was seeking costs in the sum of $6,915.00 being based on the LawPRO hourly rate apparently approved by courts as $325.00 per hour as partial indemnity.
[25] If the Plaintiffs were successful on this motion, the Plaintiffs were seeking costs in the sum of $5,557.68, including HST.
[26] The Plaintiffs have been successful in defending this motion and I find that they are entitled to some costs.
[27] I have not been provided with any offers to settle.
[28] Taking into account the written Costs Outlines of the Plaintiffs and the Defendant LawPRO, the factors set out in subrule 57.01(1) of the Rules of Civil Procedure, and in the exercise of my discretion, the Defendant LawPRO shall pay to the Plaintiff costs fixed in the sum of $3,500.00 inclusive of fees, disbursements and HST.
Madam Justice A. Trousdale
Date: April 15, 2015
CITATION: Goodman and Doyon v. LawPRO et al, 2015 ONSC 2460
BELLEVILLE COURT FILE NO.: CV-12-0294-00
DATE: 20150415
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
David Stewart Goodman and Jeannette Doyon
Plaintiffs
AND
Graham Curtis Shannon, Janet Marie Shannon,
Carson Dunlop & Associates Ltd., Gordon Mathieu, Lawyer’s Professional Indemnity Company and
The Corporation of the County of Prince Edward
Defendants
BEFORE: Madam Justice A. Trousdale
COUNSEL: S. Daniel Baldwin for the Plaintiffs David Stewart Goodman and Jeannette Doyon
John Rowinski, for the Defendant Lawyer’s Professional Indemnity Company
ENDORSEMENT
Madam Justice A. Trousdale
Released: April 15, 2015