ONTARIO
SUPERIOR COURT OF JUSTICE
COURT FILE NO.: CV-12-461457
DATE: 20150812
BETWEEN:
DANIEL FENNELL
Plaintiff
– and –
GURJINDER DEOL, BOOTA SHERGILL and COACHMAN INSURANCE COMPANY
Defendants
William Scott, for the Plaintiff
Agatha Dix and P. Pollack, for the Defendants
HEARD: July 15, 2015
S.A.Q. akhtar j.
REASONS FOR DECISION
A. INTRODUCTION
[1] On 24 August 2010, a motor vehicle accident occurred in the Peel Region. There were four vehicles involved. Three of the drivers, the plaintiff Daniel Fennell, and the co-defendants Gurjinder Deol and Boota Shergill are the parties affected by this summary judgment motion. Deol moves for a summary judgment to dismiss Fennell’s action and to dismiss Shergill’s crossclaim against him as statute barred under the Limitation Act, 2002, S.O. 2002, c. 34, Sch. B.
B. FACTUAL AND PROCEDURAL BACKGROUND
[2] A chronology of the proceedings provides the framework for understanding Deol’s summary judgment motion.
August 2010:
• The accident occurs. After the collision and the police attendance, Fennel is charged under the Highway Traffic Act, R.S.O. 1990, c. H. 8. These charges are ultimately dismissed.
• Fennell’s wife was a passenger in his vehicle, and she is the one who notes the details of Deol driver’s licence and vehicle registration. She also takes photos of the vehicles. At the time of the accident, Fennell obtains only page 2 of the motor vehicle accident report (“MVAR”). Page 2 of the report names Shergill and Samantha Sewchand as other drivers involved in the accident.
• Shortly thereafter, Fennell retains counsel, and he meets counsel in the company of his wife.
24 April 2012:
• Twenty months later, in order to obtain a complete copy of the MVAR, Fennell’s counsel writes the police for an accident report.
15 August 2012:
• Fennell’s lawyer receives page 1 of the report, which notes Deol as “Driver 1”.
16 August 2012:
• Fennell issues a Statement of Claim listing Shergill and Coachman Insurance as defendants. Inexplicably, Deol and Sewchand are not named as defendants or served with the Statement of Claim. In claiming against Shergill, Fennell pleads that his injuries meet the threshold required in motor vehicle accident cases as required by subsections 267.5(5) and (7) of the Insurance Act, R.S.O. 1990, c. I. 8, set out below.
24 August 2012:
• Pursuant to s. 5(2) of the Limitations Act, 2002, set out below, the limitation period governing Fennell’s action is presumed to have expired two years after the date of the accident.
16 September 2012:
• Fennell’s Statement of Claim is served on Shergill. (As discussed below, there is a dispute between the parties about when the limitation period for a crossclaim against Shergill commenced to run.)
29 January 2013:
• Shergill receives the MVAR from the police.
3 March 2013:
• Shergill’s counsel provides Fennell’s counsel with details regarding Deol’s identity.
18 June 2013:
• Fennell’s counsel writes to the police requesting notes of the accident.
3 October 2013:
• Fennell’s counsel receives the police notes.
20 March 2014:
• Fennell amends his Statement of Claim to add Deol to the proceedings.
13 June 2014:
• Deol serves his Statement of Defence.
8 August 2014:
• Fennell is examined by Dr. Kwok who diagnoses that Fennel’s injuries constitute a permanent serious impairment that would satisfy the threshold for a personal injury motor vehicle accident claim.
20 October 2014:
• Shergill issues his crossclaim against Deol.
27 October 2014:
• Fennell serves his Reply. Prior to this date, Deol’s counsel notifies Fennell’s counsel that a summary judgment motion to strike his proceedings on the basis of an expired limitation period will be advanced.
• Fennell’s counsel contacts LawPro and is advised to raise the “threshold issue.” As discussed below, this issue concerns Fennell’s knowledge of whether his injuries are sufficient to meet the definition of serious permanent impairment required in motor vehicle accident cases.
C. THE POSITIONS OF THE PARTIES
[3] The following table outlines the separate positions of the parties with respect to the commencement and expiry of their respective limitation periods.
Party
Position re. Date of Discovery
Limitation Period Expired
Claim Commenced
Deol
Fennell – Date of Accident: 24 August 2010
Shergill – Date of Statement of Claim:
16 September 2012
Fennell:
23 August 2012
Shergill:
15September 2014
Fennell
Date that Police Report Received: 16 August 2012
15 August 2014
20 March 2013
Fennell
Date of Kwok Report:
8 August 2014
7 August 2016
20 March 2013
Shergill
Date of Receipt of Police Report: 29 January 2013
28 August 2015
20 October 2014
D. LEGAL PRINCIPLES
1. The Limitation Period
[4] Section 4 of the Limitations Act, 2002 reads as follows:
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. Section 5 of the Act deals with the date upon which the claim is discovered:
(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).
[5] Importantly, s.5(2) of the Act imposes a presumption that a claimant knows of the claim on the day the act or omission upon which the claim is based took place, unless the contrary is proved. Section 5 (2) states:
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. 2002, c. 24, Sched. B, s. 5 (2).
[6] In motor vehicle accident personal injury claims, a party is not required to commence an action before they know that they have a “substantial chance” of success: Everding v. Skrijel, 2010 ONCA 437, 100 O.R. (3d) 641. Determination of whether a party has discovered a claim depends on the circumstances of each case. In Lawless v. Anderson, 2011 ONCA 220, the court explained at para. 23 that “[t]he question to be posed is whether the prospective plaintiff knows enough facts on which to base an allegation of negligence against the defendant.”
2. Due Diligence
[7] The discovery doctrine requires the plaintiff to exercise due diligence in discovering the facts founding the claim. In any given case, the onus is on the plaintiff to rebut the presumption set out in s. 5(2) of the Act. The plaintiff must demonstrate that he or she behaved as a reasonable person would behave in the same or similar circumstances using reasonable diligence to discovering the facts in issue: Farhat v. Monteeau, 2015 ONSC 2119, 125 O.R. (3d) 267, at para. 34; Bolton Oak Inc. v. McColl-Frontenac Inc., 2011 ONSC 6567, at paras. 12-14.
[8] The jurisprudence indicates that when the issue of due diligence is raised, a motion judge should examine the evidentiary record to determine whether there was a reasonable explanation why the discovery could not have been determined earlier through the exercise of reasonable diligence: Pepper v. Zellers Inc. (2006), 2006 42355 (ON CA), 83 O.R. (3d) 648 (C.A.), at para. 16. If a plaintiff fails to provide such an explanation, i.e. if the plaintiff fails to rebut the statutory presumption, then their action will be statute barred: Wakelin v. Gourley (2005), 2005 23123 (ON SC), 76 O.R. (3d) 272 (S.C.J.) at para. 15.
E. IS FENNELL’S CLAIM STATUTE BARRED?
1. Introduction
[9] The limitation period in this case is presumed to run from the date of the accident. Under subsection 5(2) of the Act, the onus is on Fennell to rebut the presumption by demonstrating that exercising due diligence, he discovered his claim on a later date.
[10] Fennell proposes to rebut the presumption by raising two alternative arguments. First, Fennell submits that discovery of his claim took place on 16 August 2012 when his lawyer received the first page of the MVAR from the police, which report disclosed Deol’s identity. Accordingly, the starting point of the limitation period began on this date, which would made his statement of claim timely.
[11] In the alternative, Fennell argues that the limitation period commenced on 8 August 2014 when Dr. Kwok diagnosed Fennell’s injuries as a permanent serious impairment thereby satisfying the “threshold requirement” of motor vehicle accident claims. Fennell argues that only at that point in time, did he discover he had a substantial chance of success in recovering a judgment for damages.
2. Did the Limitation Period Commence on 16 August 2012: The Identity Argument?
[12] Fennell’s first argument, that the starting point for the limitation period is 16 August 2012 is based on his purported inability, prior to that date, to identify Deol as one of the drivers in the accident.
[13] Fennell’s position is that the MVAR was incomplete when given to him on the day of the accident because the report was missing the first page. It was only when he received that page, containing Deol’s identity and details, that he submits he discovered his claim.
[14] I reject this argument, because I find that Fennell knew or ought to have known Deol’s identity on the night of the accident or very shortly thereafter. Indeed, based on the notes made by his wife, he knew that Deol should be named as a defendant virtually from the outset.
[15] Fennell’s wife, a passenger in his car at the time of the accident, spoke to Deol that night and obtained all the necessary information. As noted above, she also took pictures of the damage to the respective cars. Accordingly, Fennell knew or ought to have known who Deol was on 24 August 2010.
[16] Moreover, shortly after the accident, Fennell and his wife visited his lawyer, handing him the second page of the MVAR. It would have been apparent at this point that the first page, containing information about both Deol and Fennell was missing. It would not have been difficult for Fennell or his counsel to obtain that first page by promptly writing to the police. Fennell’s counsel, however, waited until 24 April 2012, some twenty months later, to do so.
[17] Fennell concedes that once he received the complete report, on 15 August 2012, he was in possession of the information necessary to commence his claim against Deol. However, on 16 August 2012, he chose to proceed only against Shergill. Fennell now argues that this was a “mistake” although he cannot provide any explanation as to why Deol was omitted as a party.
[18] There would be a further delay of six months before Fennell added Deol as a party to the action.
[19] Fennell’s delay both in seeking the necessary information and failing to add Deol as a party in a timely fashion means that he did not act with due diligence. He waited twenty months before writing to the police to obtain the first page of the report. Deol’s identity was already known to Fennell through his wife’s efforts. Even if he had not known Deol’s identity, it would have been very easy for Fennell to secure that information by writing to the police. After finally obtaining the MVAR, Fennell inexplicably waited a further six months before seeking to add Deol as a party to the litigation. Fennell’s actual knowledge of Deol’s identity from the time of the accident and his lack of due diligence means that his first argument fails.
3. Did the Limitation Period Commence on 8 August 2014: The Threshold Argument?
[20] Fennell argues, in the alternative, that even if he knew or ought to have known of Deol prior to the limitation period ending, discovery of the claim did not crystallise until Dr. Kwok diagnosed that he had suffered a permanent and serious injury on 8 August 2014. This is the argument that Fennell makes following the advice of his lawyer’s errors and omissions insurer. I find this argument to be disingenuous.
[21] Unlike “slip and fall” claims, motor vehicle accident claims require the “threshold condition” to be satisfied before a plaintiff can establish liability against a potential defendant. Subsections 267.5(5) and (7) of the Insurance Act, provide:
(5) Despite any other Act and subject to subsection (6), the owner of an automobile, the occupants of an automobile and any person present at the incident are not liable in an action in Ontario for damages for non-pecuniary loss, including damages for non-pecuniary loss under clause 61(2)(e) of the Family Law Act, from bodily injury or death arising directly or indirectly from the use or operation of the automobile, unless as a result of the use or operation of the automobile the injured person has died or has sustained,
(a) permanent serious disfigurement; or
(b) permanent serious impairment of an important physical, mental or psychological function. 1996, c. 21, s. 29.
[22] In Everding v. Skrijel, at para. 11, Feldman J.A. explained:
These provisions of the Insurance Act were enacted as part of a scheme that provides compensation with no-fault benefits for injuries that are not considered to be serious or permanent, but allows actions to proceed where the injuries are sufficiently significant that a substantial monetary award is likely to be recovered. Consequently, the test for the discoverability of the existence of such a claim for limitation purposes must be in accordance with this same policy.
[23] Fennell argues, therefore, that it was only when Dr. Kwok reported that his injuries were within the scope of the subsections of the Insurance Act that the claim was discovered.
[24] This argument, however, ignores the significant impact of the due diligence requirement of the discovery principle.
[25] According to Fennels’ own discovery testimony, his back injuries were apparent well before he was examined by Dr. Kwok. Tan Dhillon, Fennell’s lawyer, was aware that Fennell was complaining of back pain caused by the accident. Fennell testified that those injuries were serious enough to render him unable to fulfil occupational duties and he stopped going into work within a week of the accident. As a result, his employment was terminated in November 2010.
[26] Fennell further testified that his back condition prevented him from obtaining full time employment for a period of three years and that he was unable to accomplish even light housekeeping duties until July 2012. Throughout 2010, Fennell attended a series of therapy sessions at Springdale Physiotherapy to improve his back pain. These sessions, detailing Fennell’s various complaints of his back issues along with the prescribed treatment plans, were documented and available to Fennell and his counsel.
[27] In July 2012, prior to the expiry of the limitation period and before the issuance of the original Statement of Claim, Fennell underwent an MRI scan which disclosed a disc herniation. In May 2014, Fennell received a second MRI scan which again revealed the disc herniation.
[28] The question that begs for an answer is: in the face of such information and difficulties, why did it take Fennell four years to seek a specialist opinion regarding his injuries?
[29] At the discovery hearing, Fennell’s counsel, Dhillon, agreed that he had reviewed the 2012 MRI but did nothing further on the basis that Fennell had advised him that his doctor told him that his injury would get better with time. Fennell’s injuries, however, remained constant. The second MRI showed the same injury as the first, but it was only then that he made an appointment to obtain an orthopaedic assessment. Dhillon conceded that this was the first time that he and Fennell had taken active steps to investigate his injuries. Given that the two MRI assessments were substantially the same, it is hard to understand why the second MRI prompted an investigation and not the first. It is also clear that the extent of Fennell’s injuries were the same between the accident and his 8 August 2014 examination. According to Dr. Kwok, he was advised that Fennell “feels that his low back pain has not improved significantly in comparison to the initial pain.”
[30] Fennell’s failure to act with due diligence are further exacerbated by the fact that, when he served his original Statement of Claim against Shergill, he expressly pleaded the threshold requirement. He clearly knew of its significance and he knew that he ultimately would require a medical diagnosis of a serious injury to proceed against Shergill but he commenced his action nevertheless.
[31] If Fennell had fulfilled his due diligence obligations in the manner required, his permanent serious impairment would have been discovered no later than around the time that he commenced his action against Shergill without joining Deol. That his claim against Deol was allegedly discovered four years after the accident is due to the lackadaisical and indifferent approach taken by both Fennell and his counsel.
[32] Accordingly, I conclude that Fennell knew or ought to have known of his claim against Deol more than two years before he amended his Statement of Claim to add Deol as a party to the litigation. The amendment came too late. The claim was already statute barred. Fennell’s claim against Deol is dismissed on the basis that it is statute barred by the provisions of the Limitations Act.
F. ISSUE 2: IS SHERGILL’S CROSS-CLAIM STATUTE BARRED BY THE LIMITATION ACT?
[33] Section 18(1) of the Limitations Act, 2002 states:
Contribution and indemnity
18(1) For the purposes of subsection 5 (2) and section 15, in the case of a claim by one alleged wrongdoer against another for contribution and indemnity, the day on which the first alleged wrongdoer was served with the claim in respect of which contribution and indemnity is sought shall be deemed to be the day the act or omission on which that alleged wrongdoer’s claim is based took place
[34] Under the doctrine of discoverability, the same principles of due diligence apply to Shergill’s crossclaim against Deol as discussed above. I accept that Shergill would have discovered Deol’s identity when he received the police report on 29 January 2013. The speed at which Shergill sought to obtain the report, however, raises concerns about whether Shergill acted with due diligence.
[35] Peter Yoo, a lawyer at Beard Winter LLP, the firm acting on Shergill’s behalf, provided an affidavit setting out the chronology of the case. According to Yoo, Shergill’s insurer took “prompt” steps to obtain full particulars relating to the accident after being served with the Statement of Claim. The insurer, however, waited a period of four months before attempting to obtain the MVAR or attempting to ascertain the identity of the other drivers in the accident. I would not call this “prompt.”
[36] Shergill was present at the accident and would have known that other drivers were involved. The requirement of due diligence, in my view, required Shergill to act more promptly than he did. The issue then becomes when ought Shergill to have obtained the MVAR which identified Deol.
[37] In my opinion, acting reasonably it would have not taken as long as 4 and half months from the service of the Statement of Claim to discover the claim for contribution and indemnity. On the other hand, acting reasonably and without Deol being identified in the Statement of Claim as a co-defendant, Shergill would not with due diligence have discovered his claim so soon as 34 days after service of the Statement of Claim (i.e. from September 16, 2012 to October 20, 2012).
[38] In my opinion, Shergill ought to have discovered his claim for contribution and indemnity later in the month of October or early November, and it, therefore, follows that his crossclaim for contribution and indemnity issued on October 20, 2014 was timely.
[39] It is necessary to address one additional matter. Having received the report, and now possessing the information required to file a Third Party action against Deol, Shergill waited a further nineteen months to file his crossclaim. Peter Yoo’s explanation is that, having been told that Deol was going to be added as a defendant to the action, “there was no need to issue a separate Third Party Claim.” Yoo decided to defer delivering pleadings given his understanding that Deol would be added to proceedings.
[40] Deol submits that Shergill’s conduct displayed a casual attitude towards the litigation not in keeping with his duty of due diligence. I disagree. It made sense for Shergill to wait for Deol to be added to the main action as a co-defendant so that he could cross-claim rather than bringing a third party claim for contribution and indemnity. The courts have encouraged this manner of litigation: Waterloo Region District School Board v. CRD Construction Ltd., 2010 ONCA 838, 103 O.R. (3d) 81.
G. CONCLUSION AND COSTS
[41] For the reasons set out above, Deol’s summary judgment motion against Fennell is granted and Fennell’s action against Deol is dismissed. The summary judgment motion against Shergill is dismissed.
[42] If the parties cannot agree about the matter of costs, they may make submissions in writing no longer than 5 pages in length beginning with Deol’s submissions as against Fennel and Shergills submissions as against Deol within 20 days followed by Fennells’ and Deols’ responding submissions within a further 20 days.
S.A.Q. Akhtar J.
Released: August 12, 2015
COURT FILE NO.: CV-12-461457
DATE: 20150812
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
DANIEL FENNELL
Plaintiff
– and –
GURJINDER DEOL, BOOTA SHERGILL and COACHMAN INSURANCE COMPANY
Defendants
REASONS FOR JUDGMENT
S.A.Q. Akhtar J.