Court File and Parties
Court File No. C-1008-10
Date: 2015-09-30
SUPERIOR COURT OF JUSTICE – ONTARIO
RE: Factory Outlet Car Sales and Leasing Inc., o/a KW Kia and Steve Scherer - Plaintiff
AND:
Clarke L. Melville Law Firm and Clarke Melville - Defendant
BEFORE: James W. Sloan
COUNSEL: Christopher Clemmer - Counsel for the Plaintiff
Shannon Puddister - Counsel for the Defendant
HEARD: September 29, 2015
ENDORSEMENT
[1] This is a solicitor’s negligence action.
[2] The Statement of Claim was issued November 12, 2010, Statement of Defence and Counterclaim were served February 28, 2011, the Plaintiff’s Affidavit of Documents was served July 5, 2012, the Defendant’s Affidavit of Documents was served October 1, 2012, and the Plaintiff’s Reply and Defence to Counterclaim were served May 24, 2013.
[3] Pursuant to the June 27, 2014 Order of Justice Glithero which went unopposed, the first administrative dismissal of the registrar dated April 2, 2014 was set aside and the order imposed a new timetable peremptory on the plaintiffs.
[4] In the new timetable, examinations were to be completed by October 31, 2014, undertakings were to be answered by November 30, 2014 and the action was to be set down for trial by March 31, 2015.
[5] No notice of an approaching dismissal was served by the local registrar’s office on either lawyer however, the action was apparently dismissed on April 23, 2015, even though there is no hard copy of that order in the file.
[6] No copy of the order dismissing the action, whether in hardcopy or electronic form, was ever communicated by local registrar’s office to either lawyer.
[7] Notwithstanding the April 23, 2015 date, and the fact that undertakings were to have been answered by November 30, 2014, the plaintiff’s lawyer and his administrative assistant continued to work on undertakings in April, May and June 2015.
[8] While Defendant’s counsel became aware that the action had been dismissed on or about May 19, 2015, plaintiff’s counsel did not become aware that the action had been dismissed until he tried to file the trial record on or about June 3, 2015.
[9] The current motion was drafted on or about June 4, 2015 and scheduled to be heard initially on June 11, 2015. Because this is a long motion, and to allow the parties to file the appropriate papers, it was ultimately scheduled to be heard on September 29, 2015.
The Law
[10] Both parties agree that the four Reid Factors, in part, must guide my decision. The so-called Reid Factors come out of the case of Reid v. Dow Corning Corp. (2011), 11. C.P.C. (5th) 80.
[11] The four factors set out in Reid are:
“Explanation of the Litigation and Delay: The plaintiff must adequately explain the delay in the progress of the litigation from the institution of the action until the deadline for setting the action down for trial as set out in the status notice. She must satisfy the court that steps were being taken to advance litigation towards trial, or if such steps were not taken to explain why…. If either the solicitor or the client made a deliberate decision not to advance litigation toward trial than the motion to set aside the dismissal will fail.”
“Inadvertence in Missing the Deadline: The plaintiff or her solicitor must lead satisfactory evidence to explain that they always intended to set the action down within the time limit set out in the status notice, or request a status hearing, but failed to do so through inadvertence. In other words of the pennultimate dismissal order was made as a result of inadvertence.”
“The Motion Is Brought Promptly:” The defendant concedes in this case that the motion was brought promptly.
“No Prejudice to the Defendant: The plaintiff must convince the court that the defendants have not demonstrated any significant prejudice in presenting their case at trial as a result of the plaintiff’s delay or as a result of steps taken following the dismissal of the action.”
[12] In the case of Scaini v. Prochnicki, 2007 ONCA 63, the Ontario Court of Appeal held that the plaintiff does not have to necessarily satisfy each of the Reid Factors. They went on to state that the Court’s “analysis must be contextual to permit the court to make the order that is just.”
[13] In the case of Kara v. Arnold, 2014 ONCA 871, the Ontario Court of Appeal at paragraph 8 stated: “The test is twofold and conjunctive: the plaintiff has the onus of demonstrating both, that there is an acceptable explanation for the delay and that, if the action were allowed to proceed, the defendant would suffer no non-compensable prejudice.”
[14] The Court of Appeal goes on at paragraph 10 to state: “The courts do not take a rigid or “purely formalistic and mechanical” approach to the application of timelines in the Rules “that would penalize the parties for technical noncompliance and frustrate the fundamental goal of resolving disputes on their merits.””
The Position of the Defendant
[15] The position of the defendant is as follows:
First - The interests of justice do not require setting aside this administrative dismissal.
Second - The plaintiff was responsible for delay generally in moving this action forward.
[16] Exhibit 1 is a timeline of the action setting out some significant and moderately significant events in this litigation.
[17] The defendant states that between November 12, 2010 and May 16, 2013, which was the first time table Order of Justice Campbell, nothing happened except for most of the pleadings and the affidavit of documents being exchanged. The timetable in Justice Campbell’s order called for the action to be set down by March 28, 2014.
[18] The first administrative dismissal order was dated April 2, 2014, which resulted in the second timetable order of Justice Glithero dated June 25, 2014.
[19] Notwithstanding that plaintiff’s counsel accused defendant’s counsel of making it difficult to set up discovery dates during the summer of 2014, examinations for discovery of all parties were completed (by agreement) on November 5, 2014 which is just beyond the date for completion, set out in Justice Glithero’s order.
[20] Notwithstanding that the plaintiff’s undertakings were to be completed by November 30, 2014, they were not complied with until June 15, 2015, over seven months late. This tardiness persisted, notwithstanding letters requesting answers to undertakings dated December 23, 2014 and January 19, 2015 from defendant’s counsel.
Third - In addition to Justice Glithero’s order being a second order imposing deadlines it was also peremptory on the plaintiff.
Fourth - The defendant will be prejudiced if this action is allowed to move forward.
[21] Although the defendant has not stated in their affidavit material that the defendant will suffer specific prejudice if the administrative dismissal is set aside, the defendant took the court briefly through the fact that parts of this case go back to a franchise agreement dated in 1999 and then through disagreements between the plaintiff and Kia Canada in 2003 and 2006.
[22] As a result of these disagreements, the plaintiff hired the defendant and the matter was settled in 2009 through mediation.
[23] The plaintiff’s action against the defendant is that the defendant did not get an appropriate status quo agreement and that he pressured the plaintiff to settle the matter and signed documents on the plaintiff’s behalf without authority from the plaintiff to do so.
[24] It is the position of the defendant that the court can look at what the parties did throughout the entire action to move the matter forward and that the court is not restricted to the time period between Justice Glithero’s order which was obtained on an unopposed basis and the date of dismissal.
Defendant’s Legal Argument
[25] In addition to the Reid Factors and the contextual approach, the defendant also relies on the following case law:
[26] With respect to rule 48.14, the defendants quote from the case of Riggitano v. Standard, 2009 CanLll 23892 (S.C.J.) which was affirmed by the Ontario Court of Appeal.
[27] At paragraph five of the trial decision, the learned trial judge stated: “It is never pleasant to dismiss the plaintiff’s action for delay. Nevertheless Rule 48.14 clearly contemplates that two years following the filing of a statement of defence is viewed as being ample time to complete remaining steps and have a matter set down for trial, absent some satisfactory explanation. Where the contest arises, sub rule (8) squarely puts the onus on the plaintiff to show cause why the action should not be dismissed for delay. Here more than five years, and hence more than twice the normal time period contemplated by the rule, has gone by and in my assessment the plaintiff has done very little to move the matter along. In my opinion the materials do not disclose a satisfactory explanation for the delay. If the common submission, as made here, to the effect that a dismissal would be unfair to the plaintiff is permitted to always trump the provision in the rules contemplating a reasonably timely procedure for the disposition of actions, then the rule would be effectively gutted…”
[28] With respect to whether the court should consider all delay occasioned by the plaintiff or just the delay since the latest timetable order, the defendants have drawn the court’s attention to the case of 1196158 Ontario Inc. v. 6274013 Canada Limited, 2012 ONCA 544, where at paragraph 25 the Ontario Court of Appeal states:
“I completely disagree with the contention that the plaintiff was somehow absolved for all prior delay by the order made at the January 2010 status hearing. That order, made despite over three years of delay, was properly described by the September 2011 status hearing Judge as a “lifeline” that allowed the plaintiff to proceed on the basis of the timetable ordered. The plaintiff ignored the lifeline it had been given and failed to respect the timetable that had been set. Without repentance, there can be no absolution. The plaintiff did not emerge from the January 2010 status hearing with a clean slate and it was open to the status hearing judge to consider the entire history of the delay.”
[29] The defendant submits that under the contextual approach the court must have regard to the following circumstances:
the matters at issue include events dating back to 2003,
this is the second time the action has been administratively dismissed,
Justice Glithero’s order was pre-emptory on the plaintiff,
the plaintiff’s attitude towards the pre-emptory order was cavalier,
the inordinate and unexplained 3 ½ year delay in which the defendants assert the plaintiffs essentially took no steps to advance their claim,
the plaintiffs failure to comply with a timetable for answering undertakings and in fact that they were not in a position to deliver those undertakings even by March 31, 2015 the date scheduled to set the action down for trial and
the plaintiff’s failure to set the matter down for trial, despite being a position to do so for more than four months prior to the set down date of March 31, 2015.
The Plaintiff’s Position
[30] The action was always moving forward.
[31] The plaintiff’s solicitor had a tickler system in place, however, because of unfortunate medical circumstances for his administrative assistant, the deadline for filing the trial record was missed.
[32] The unfortunate medical circumstances of the plaintiff’s lawyer’s administrative assistant were that between March 27 and April 2 of 2015 she was hospitalized due to a miscarriage. On the evidence before me it appears that this assistant was the one charged with the duty to run the tickler system with respect to time sensitive dates in the plaintiff’s solicitor’s office.
[33] As of June 2015 all pretrial matters had been completed and the matter was ready for trial.
[34] Prior to March 31, 2015, the plaintiff’s lawyer had completed compiling the trial record.
The Plaintiff’s Legal Position
[35] With respect to the Riggitano case, counsel for the plaintiff points out that counsel for the plaintiff in that case misrepresented to the judge that steps were being taken when in fact they were not. In addition, affidavits of documents had not been exchanged, discoveries had not been held and the case was nowhere near being able to be set down for trial.
[36] Rule 48.14 was substantially amended sometime in 2014. Under the former rule, the registrar was to send out a status notice that the action would be dismissed for delay within 90 days in all actions where the action had not been listed for trial within two years after the first defence had been filed.
[37] The new rule contemplates the registrar dismissing the action for delay if it has not been set down for trial by the fifth anniversary date of the commencement of the action.
[38] The plaintiff argues that if this amendment had been made prior to the commencement of this action, the earliest it could be dismissed by the registrar would be November 12, 2015.
[39] In the case of Troung v. City of Toronto 2015 ONCA 3509, the learned Master set aside a second dismissal of an action due to delay, “where a reasonable, if imperfect, explanation had been proffered” and there was “undue reliance on administrative staff”.
[40] The Master goes on to state at paragraph 26; “As for the issue of prejudice, of concern is any prejudice to the defendant’s ability to defend the action that would [arise] from steps taken following the dismissal, or which would result from the restoration of the action following the registrar’s dismissal…This prejudice must be balanced against the prejudice to the plaintiff and having the case dismissed.”
[41] The plaintiff submits that under the contextual approach, the court must have regard to the following circumstances:
an action should be decided on its merits,
the pleadings are complete, affidavits of documents and productions have been exchanged, discoveries have been held, undertakings complied with and the trial record has been completed and is ready to be filed,
other than general allegations about prejudice because of the passage of time, the defendants have not filed any material to outline any specific prejudice that they would suffer,
at no time could defendants counsel have reasonably thought that the plaintiff was abandoning the action,
if the new rule 48.14 had been in effect in 2010 the plaintiff would have until at least November 2015 to set the matter down for trial,
there is nothing to suggest that the failure to set the action down was a matter of choice,
there is an unusual and unfortunate explanation for missing the deadline for setting the matter down for trial being that of the medical emergency of the plaintiff’s lawyer’s administrative assistant,
it is the plaintiff who must prove his case on a balance of probabilities and therefore any prejudice from the passage of time may affect the plaintiff more than the defendant,
if is the administrative dismissal is not set aside it will likely spawn yet another legal action against the lawyer for the plaintiff.
Reasons For Judgment
[42] With respect to any delay in the litigation, there appears to have been modest delay in approximately the first half to three years of this litigation. Without taking into account the timetables as ordered by the court and taking into account the plaintiff’s major surgery, the pace of the litigation after October 1, 2013 was not terribly slow. There is certainly no evidence before me to suggest that the plaintiff made a deliberate decision not to advance a litigation towards trial, in fact the evidence is quite the opposite
[43] With respect to inadvertence in missing the deadline, I am satisfied with the explanation of the plaintiff’s lawyer’s administrative assistant unfortunate medical problem being the main reason for the plaintiff’s lawyer failure to set this matter down by March 31, 2015. Notwithstanding the previous sentence, the plaintiff’s lawyer, if he has not done so already, should immediately review his tickler system and who has the ultimate responsibility for it.
[44] With respect to the issue of prejudice to the defendant, I find that the defendant has not shown any significant or even a moderate prejudice that may result in the order for dismissal is set aside. The action is immediately ready to be set down for trial and subject to a pretrial being held can be placed on the trial list for November 2015 or January 2016.
[45] Although I have concerns that this is the second time that the action has been administratively dismissed and that Justice Glithero’s order made the second timetable peremptory on the plaintiff, on a contextual approach I find that the just order for this court to make is to have the action tried on its merits.
[46] I therefore set aside the notice of dismissal dated April 23, 2015.
[47] This matter shall be set down for trial on or before October 16, 2015.
[48] Under the circumstances of this case I make no order as to costs
Justice James W. Sloan
Date: September 30, 2015