SUPERIOR COURT OF JUSTICE - ONTARIO
OTTAWA COURT FILE NO.: 13-59663
DATE: 27 Jul 2015
RE: DOUG BROWN, Plaintiff
- and –
ARC HEALTH CARE SOLUTIONS INC., Respondent
- and –
VANTAGE ENDOSCOPY, Garnishee
BEFORE: JUSTICE BELCH
COUNSEL:
Roberto Ghignone, for Doug Brown
John Paul Zubec, for ARC Health Care Solutions Inc.
Vantage Endoscopy, not appearing
HEARD: May 15, 2015 at Ottawa
ENDORSEMENT ON MOTION
[1] ARC Health Care Solutions Inc., (Solutions) brings this motion for the following relief: An Order
(i) to determine the rights of the garnishee, Vantage Endoscopy;
(ii) to vacate or to terminate the Notice of Garnishment;
(iii) to amend the October 10, 2014 Order by substituting ARC Stainless Inc. as the defendant in place of ARC Healthcare Solutions Inc.
(iv) to set aside the Writ of Seizure and Sale of the real and personal property of ARC Health Care Solutions Inc.; and
(v) costs.
[2] For the following reasons, this Court orders: the Order is varied as requested, it is not necessary to determine the rights of the Garnishee, the Notice of Garnishment is vacated and the Writ of Seizure and Sale is set aside.
The Parties and Background
[3] Doug Brown, (Responding party) was the plaintiff in a wrongful dismissal claim naming ARC Healthcare Solutions Inc. (Moving party, defendant, Solutions). The claim was settled in mediation on April 14, 2014 with Minutes of Settlement and a Release signed by the parties. The settlement was later incorporated into a Court Order, on consent.
[4] When Doug Brown sought to enforce the settlement, the extent of the underlying confusion became apparent; ARC had been used in connection with ARC Stainless Inc., ARC Healthcare Solutions, and ARC Healthcare Solutions Inc. Which of these is the correct party?
The Position of the Parties
[5] ARC Healthcare Solutions Inc. submits the Court Order should be considered a nullity because this company was not incorporated until eight months after the Order and Doug Brown was never its employee. The moving party further submits when an Order contains an error arising from an accidental slip on which the court did not adjudicate, the Order may be amended by motion because it does not express the real intention of the parties. The test as to whether there has been a meeting of the minds is an objective one, that is, would an objective, reasonable bystander conclude that, in all of the circumstances the parties intended to enter this settlement? The moving party submits the reasonable bystander would say no and the settlement and the consent Order based upon it must be varied or set aside.
[6] Doug Brown submits he first worked for ARC Stainless Inc. (Stainless) in 2009, but was informed in 2012 he was now working for Healthcare Solutions. His business cards reflected he was working with Healthcare Solutions. When Stainless made its Proposal to Creditors, he was not named as a creditor. The issue on this motion is whether the consent Order should be varied. The moving party has not established there was a common mistake in agreeing to the Order entered into on October 10, 2014. The Order was clear and unequivocal and should not be set aside or varied.
Analysis
[7] Doug Brown deposes in his affidavit sworn May 8, 2015 he began working for ARC Stainless Inc. in 2009. In 2012, he was informed he was now working for ARC Healthcare Solutions and his e-mail address, business cards, and related materials reflect this. He identifies Steve Sewell to whom he reported, as the source of this information. Steve Sewell denies this in his affidavit, sworn May 13, 2015.
[8] Evidently, by the spring of 2013, ARC Stainless Inc. was known both publicly and to its employees to carry on business as ARC Healthcare Solutions.
[9] The letter of October 9, 2013 terminating Doug Brown’s employment was signed by Steve Sewell in his capacity as Director-Sales and Distribution for ARC Healthcare Solutions.
[10] On December 18, 2013, a Claim was issued for wrongful dismissal by Doug Brown naming ARC Health Care Solutions Inc. as defendant.
[11] On February 21, 2014, ARC Stainless Inc. defended the Claim. In paragraph one of its Statement of Defence, Stainless pleaded ARC Stainless Inc. was incorrectly identified as ARC Health Care Solutions Inc., defendant.
[12] The parties proceeded to mediation on April 14, 2014. They reached agreement wherein Doug Brown was to be paid $19,320.67 by ARC; the Minutes of Settlement were executed on behalf of ARC Stainless Inc. Doug Brown in paragraph one of the accompanying Release acknowledged “…in consideration of the payments to me by ARC Stainless Inc. in the Minutes of Settlement dated April 14, 2014…”. Doug Brown has received partial payment as the amount currently outstanding is $14,699.16.
[13] Before attending mediation, neither the parties nor their counsel had amended the action’s style of cause which still referred to the defendant as ARC Healthcare Solutions Inc. Further, the Minutes of Settlement and Release carried forward the same style of cause, Healthcare Solutions Inc. not Stainless Inc.
[14] ARC Healthcare Solutions Inc. was not incorporated until October 1, 2014, approximately 5½ months after the mediated settlement. Its shareholders are Robert Swayne, Marc Bresee, and Julie Noel-Johnson, all of whom were also employees of ARC Stainless Inc.
[15] The Order of Mr. Justice Charbonneau dated October 10, 2014 incorporating the settlement also carried forward the original style of cause identifying the defendant as ARC Healthcare Solutions Inc., not ARC Stainless Inc.
[16] In February 2015, after Doug Brown had taken steps to enforce the Order, ARC Healthcare Solutions Inc. first raised the issue of mistake in the consent Order and now alleges the Order should have been against ARC Stainless Inc.
[17] In April 2015, ARC Stainless Inc. made a Proposal to Creditors which did not include Doug Brown as a creditor although as a result of this motion his name has subsequently been added to the list of creditors.
Conclusion
[18] As was mentioned earlier, confusion has arisen by the use of ARC with Stainless Inc., Healthcare Solutions, and Healthcare Solutions Inc. The confusion has not been limited to the parties; counsel also appear to have lost sight of the requested correction initially identified in paragraph one of the Statement of Defence.
[19] Where a mistake has arisen in an Order made without adjudication, that mistake can be rectified on motion (see Rule 59.06). The grounds go to the formation of the Settlement. Is the settlement giving rise to the consent Order so tainted in its formation as to justify setting it, or a part of it, aside?
[20] The test is whether a reasonable, objective bystander would conclude there had been a meeting of the minds, commonly referred to as consensus ad idem, and the settlement in question was the settlement the parties intended.
[21] The Ontario Court of Appeal in UBS Securities Canada, Inc. v. Sands Brothers Canada Ltd., 2009 ONCA 328, 95 O.R. (3d) 93 at paragraph 47 held “…As intention alone is insufficient to create an enforceable agreement, it is necessary that the essential terms of the agreement are also sufficiently certain.”
[22] In support of the proposition this settlement naming ARC Healthcare Solutions Inc. as a party was the intended agreement, are the following: Robert Swayne is a common denominator in all three entities. He was the president and shareholder of ARC Stainless Inc. and that company carried on business as Healthcare Solutions. He is a Director and shareholder of ARC Healthcare Solutions Inc. Further, the shareholders of ARC Healthcare Solutions Inc. were all employees of ARC Stainless Inc. Precision is lacking in the use of the business names. Doug Brown cannot be faulted for thinking he worked for Healthcare Solutions. His business cards show he did.
[23] On the other hand, his business cards identified the named business as ARC Healthcare Solutions, not ARC Health Care Solutions Inc. While the website for ARC Healthcare Solutions now contains the word Inc. that is said to be as the result of a recent change, one which occurred after settlement. Doug Brown was put on notice by the Statement of Defence in which it was pled the defendant was ARC Stainless Inc. The Minutes of Settlement were executed on behalf of ARC Stainless Inc. The Release signed by Doug Brown acknowledges payment was to be from ARC Stainless Inc., in addition as an employee he presumably knew ARC Stainless Inc. carried on business as ARC Healthcare Solutions and finally, ARC Healthcare Solutions Inc. was not in existence when the Minutes of Settlement were signed.
[24] Taking all of the circumstances into consideration, the court is satisfied an objective, reasonable bystander would conclude the settlement Doug Brown signed was with ARC Stainless Inc. and the consent Order must be varied to reflect this finding. In reaching this conclusion, the court does not find Doug Brown was a party who “snapped at” and took advantage of an obviously mistaken offer.
[25] Case authority suggests a consent Order which is sufficiently certain, clear and unambiguous on its face is not to be lightly set aside. While this consent Order is clearly in keeping with the Minutes of Settlement, those Minutes of Settlement are not clear and unambiguous on their face. Naming the correct party to an agreement is an essential term. These Minutes in their style of cause identify ARC Healthcare Solutions Inc. as a party, a company not yet in existence but are signed on behalf of ARC Stainless Inc., not ARC Healthcare Solutions Inc. and the Release, an integral part of the settlement, has Doug Brown acknowledging payment is to come from ARC Stainless Inc. If the style of cause had been amended to ARC Stainless Inc. then the contents of the Minutes of Settlement and Release make sense.
[26] The Court orders the style of cause is amended to substitute ARC Stainless Inc. in place of ARC Health Care Solutions Inc. Given the Court’s decision, the Notice of Garnishment is vacated as it named the wrong party. It is then no longer necessary to deal with the rights and liabilities of the Garnishee, Vantage Endoscopy or to address whether Vantage ever did business with ARC Healthcare Solutions Inc. The Writ of Seizure and Sale is similarly set aside.
Costs
[27] If counsel for the parties are unable to settle the issue of costs, the court will fix costs provided written submissions limited to 5 pages from each side are received by the court at the Kingston Court office prior to August 24, 2015. If not received by that date, the court assumes cost have been settled.
Honourable Mr. Justice Douglas M. Belch
Released: July 27, 2015
OTTAWA COURT FILE NO.: 13-59663
DATE: 27 Jul 2015
SUPERIOR COURT OF JUSTICE - ONTARIO
RE:
DOUG BROWN,
Plaintiff
- and –
ARC HEALTH CARE SOLUTIONS INC,
Defendant
- and –
VANTAGE ENDOSCOPY,
Garnishee
ENDORSEMENT ON MOTION
BELCH, J.
DATE: July 27, 2015