ONTARIO
SUPERIOR COURT OF JUSTICE
COURT FILE NO.: CV-14-498625
DATE: 20150710
BETWEEN:
Denis Gubert
Plaintiff
– and –
1536320 Ontario Limited, palmont Corp. and Barry Godfrey
Defendants
Matt W. Mulholland for the Plaintiff
Wolfgang Kaufmann for the Defendants
HEARD: In writing
PERELL, J.
REASONS FOR DECISION - COSTS
[1] The Defendants 1536320 Ontario Limited, Palmont Corp., and Barry Godfrey, brought a motion for summary judgment in which they submitted that the Plaintiff Denis Gubert’s action should be dismissed because, amongst other things, it was answered by an Asset Allocation Agreement dated April 23, 2009. I dismissed the summary judgment motion. See Gubert v. 1536320 Ontario Limited, 2015 ONSC 3294.
[2] In my Reasons for Decision, I stated that the Defendants’ summary judgment motion was a failed attempt to unscramble the scrambled egg of the business relationship between Messrs. Godfrey and Gubert, a relationship that involved the action at bar and several other pending actions. I decided that the case was not appropriate for a summary judgment.
[3] At the very heart of the motion for summary judgment was the question of what was the effect and status of the Asset Allocation Agreement, and in my Reasons for Decision, I noted that there were significant problems about how that critical question had come before the court.
[4] I noted that determining whether to grant a summary judgment was problematic because (a) Mr. Gubert’s various allegations explaining why the Asset Allocation Agreement was rescinded had never been properly pleaded because Mr. Gubert did not deliver a Reply to Mr. Godfrey’s Statement of Defence; and (b) the evidentiary record was filled with evidence about the unpleaded allegations that supported Mr. Gubert’s rescission argument but that created a plethora of genuine issues for trial that Mr. Godfrey attempted to circumvent by ignoring them. He simply insisted that there was no factual basis for the Asset Allocation Agreement having been rescinded.
[5] Having dismissed the summary judgment motion, I invited costs submissions, but I alerted the parties that my inclination was to award no costs for the summary judgment motion to either party. I stated that although Mr. Gubert was successful in resisting the summary judgment motion, he provoked it by not properly replying to Mr. Godfrey’s Statement of Defence.
[6] The parties could not agree about the matter of costs, and I received written submissions. The unsuccessful party on the motion, Mr. Godfrey, agreed with my view that there should be no order of costs.
[7] Mr. Gubert, however, claims costs of $19,667.75 and submits that he should not be denied costs because of my view that the various allegations explaining why the Asset Allocation Agreement was rescinded had never been properly pleaded because Mr. Gubert did not deliver a Reply to Mr. Godfrey’s Statement of Defence.
[8] Mr. Gubert submits that it was unnecessary to file a Reply because, pursuant to the Rules of Civil Procedure, it is assumed that the plaintiff denies the facts contained in the statement of defence. Further, Mr. Gubert submits that because of the material filed in another proceeding between the parties and because of the material filed for the summary judgment motion, Mr. Godfrey had notice of the defence regarding the Asset Allocation Agreement.
[9] I am not persuaded by Mr. Gubert’s submission that I should change my mind. Mr. Gubert’s position does not address the problem that the alleged factual basis for a rescission of the Asset Allocation Agreement has never been properly pleaded. The implied denial rule does not address the problem either.
[10] Rule 25.07 (3), a general pleading rule, provides that the denial of a fact pleaded is not sufficient where the opposing party is relying on a different version of the facts; the different version must be pleaded. Rule 25.08 (1), a rule about pleading a reply to a defence, is to the same effect. Rule 25.08 (1) states:
Different Version of Facts
A party who intends to prove a version of the facts different from that pleaded in the opposite party’s defence shall deliver a reply setting out the different version, unless it has already been pleaded in the claim.
[11] In my opinion, the successful party on the summary judgment motion did not comply with the rules of pleading. There should be no costs awarded for the summary judgment motion to either party.
[12] Order accordingly.
Perell, J.
Released: July 10, 2015
COURT FILE NO.: CV-14-498625
DATE: 20150710
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Denis Gubert
Plaintiff
– and –
1536320 Ontario Limited, palmont Corp. and Barry Godfrey
Defendants
REASONS FOR DECISION - COSTS
PERELL J.
Released: July 10, 2015