SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Rajendran v. Nallathamby

Court File No.: CV-13-480700

2015 ONSC 5500

HEARD: September 2, 2015

BEFORE: MASTER R.A. MUIR

COUNSEL:
Faranaz Siganporia for the plaintiff
Peter Esfandiari for the defendants
Dena Oberman for Unifund Assurance Company

ENDORSEMENT

Master R.A. Muir -

[1] The plaintiff brings a motion pursuant to Rule 37.14 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 (the “Rules”) for an order setting aside the order of the registrar dated January 13, 2014 dismissing this action as abandoned. The plaintiff also seeks leave to amend his statement of claim to add his own insurer, Unifund Assurance Company (“Unifund”) as a defendant pursuant to the uninsured motorist coverage provided by a policy of insurance issued to the plaintiff’s mother.

[2] The defendants and Unifund oppose the granting of the relief requested on this motion.

[3] This action arises from a motor vehicle accident that took place on May 20, 2011. The plaintiff retained counsel soon after the accident. The defendants and their insurer were put on notice of the claim at an early date. The plaintiff had early concerns that there may be a coverage issue with the defendants’ insurer as it appeared that the operator of the defendants’ vehicle was driving with a suspended licence. For this reason, the plaintiff’s lawyers also provided Unifund with early notice of the potential claim.

[4] The statement of claim was issued on May 17, 2013. It was served on the defendants shortly thereafter. The defendants did not deliver a notice of intent to defend or a statement of defence. As a result, the court issued a notice on November 14, 2013 that the action would be dismissed as abandoned within 45 days unless a defence was filed or the action disposed of by final order. In response to this notice, the plaintiff’s lawyer wrote to the defendants’ insurance adjuster on November 19, 2013. The plaintiff’s lawyer asked that the defendants serve a defence or default proceedings would be necessary. The defendants’ insurer did not respond to this letter. The action was then dismissed by the court on January 13, 2014.

[5] It appears that the plaintiff took no steps to bring this motion until November 2014. After some back and forth with counsel for the defendants, this motion was booked for June 5, 2015. It appears that the plaintiff served an amended notice of motion seeking additional relief to add Unifund as a defendant in May 2015. The motion was adjourned once again to August 17, 2015. It did not proceed on that date due to a late confirmation by the plaintiff. It was then rescheduled and heard by me today.

[6] The law relating to motions for an order setting aside an administrative dismissal order is summarized in my decision in Kamboj v. Sidhu, 2013 ONSC 2478 (Master) at paragraphs 17-20. Four factors are of central importance. The court must consider the explanation for the delay, whether the deadline was missed due to inadvertence, any delay in bringing the motion to set aside the dismissal order and prejudice to the defendant. I have considered and applied those factors and the other principles set out in Kamboj. In my view, it is just that the dismissal order be set aside.

[7] I do agree with the defendants that there is some appearance of delay with this action. Very little was done to move this action forward after the statement of claim was served in May 2013. The plaintiff did not demand a defence or take any default proceedings. It was only after the court issued a pending dismissal notice that the plaintiff requested a defence and that request was not the subject of any follow-up.

[8] However, when viewed in context, this delay is not inordinately long. I note that the Rules allow for up to six months for a statement of claim to be served. The plaintiff’s delay was only a few days longer than that. The delay is certainly not of the magnitude seen in several of the Court of Appeal decisions where dismissal orders have been upheld. As I have said in other decisions, the plaintiff’s explanation need not be perfect. It simply needs to be adequate. Although a plaintiff is primarily responsible for the progress of an action, a defendant has an obligation to respond to a claim in a timely manner. The defendants in this action failed to deliver a defence for many months after being served. This action would not have been dismissed if they had.

[9] In my view, the plaintiff has, on balance, satisfied this element of the test.

[10] In my view, the deadline set out in the pending dismissal notice was missed through inadvertence. After receiving the notice, the plaintiff’s lawyers contacted the defendants’ insurance adjuster and demanded a defence. I also note that there is some evidence that personnel changes in late 2013 may have contributed to missing the deadline. If the plaintiff or his lawyers had made a deliberate decision to abandon this action they would not have demanded the defence. Missing the deadline must have been inadvertent. No other explanation makes sense.

[11] This motion was not brought promptly and no explanation has been provided for why the plaintiff’s lawyers waited 11 months to do so. This element of the test has not been met.

[12] I am satisfied that the plaintiff has rebutted any applicable presumption of prejudice. First, the delay in this action is not that significant in my view and therefore the presumption of prejudice is not that strong. The claim is well within the five year dismissal period now found in the amended version of Rule 48.14. The plaintiff was a passenger. There are no liability issues. The plaintiff has requested many of the necessary medical records and some have been received. An OHIP summary has been ordered which will cover a period three years pre-accident. Both the defendants’ insurer and Unifund received early notice of this claim and carried out at least some initial investigation. The plaintiff advanced an accident benefits claim that has been resolved. That claim would have included at least some medical documentation. Finally, neither the defendants nor Unifund have provided any evidence of actual prejudice.

[13] When deciding motions of this nature, the court is to adopt a contextual approach in which it weighs all relevant considerations to determine the result that is just in the circumstances. The court must, of course, balance the strong public and private interest in promoting the timely resolution of disputes with the entitlement of a plaintiff to have his claim decided on the merits. However, the general preference in our system of civil justice is for the determination of disputes on their merits.

[14] In my view, the plaintiff has satisfied three of the four Reid factors, including the key consideration of prejudice.

[15] For these reasons, I have concluded that it is just in the circumstances of this action that the dismissal order of the registrar dated January 13, 2014 be set aside.

[16] I am also granting leave to the plaintiff to amend the statement of claim to add Unifund. The claim against Unifund is based on the defendants being uninsured. It appears from the evidence on this motion that the defendants’ insurer did not formally deny coverage until January 28, 2013 at the earliest and that denial was in connection with a related action. In my view, the defendants were not “uninsured” until that denial was delivered. Of course, the plaintiff was not aware of the formal denial of coverage when it was delivered. The plaintiff is not a party to the related action. The plaintiff’s evidence is that he became aware of the denial when his lawyers were advised by the defendants’ lawyers in November 2014. The plaintiff’s lawyers were certainly aware of coverage concerns from the very outset. However, they were not aware of the denial of coverage until November 2014. In my view, the limitation period did not begin to run until the plaintiff knew that he was facing uninsured defendants.

[17] The plaintiff has been successful and ordinarily costs should follow the event. However, it is my view that the plaintiff has received a significant indulgence. The evidence on this motion was not nearly as complete as it should have been. The plaintiff did not prepare a factum or provide the court with any authorities. No costs outline was prepared. In my view, it is fair and reasonable that there be no order for the costs of this motion.

[18] I therefore order as follows:

(a) the order of the registrar of January 13, 2014 is hereby set aside;

(b) the plaintiff is hereby granted leave to amend his statement of claim in accordance with the draft amended statement of claim at tab 3 of the motion record;

(c) this action shall be set down for trial by May 17, 2018; and,

(d) there shall be no order with respect to the costs of this motion.

Master R.A. Muir

DATE: September 2, 2015