Galota v. Festival Hall Developments Limited et al.
[Indexed as: Galota v. Festival Hall Developments Ltd.]
Ontario Reports
Ontario Superior Court of Justice,
Corbett J.
October 6, 2015
127 O.R. (3d) 260 | 2015 ONSC 6177
Case Summary
Limitations — Discoverability — Plaintiff suing bar for damages sustained when she fell off elevated dance stage but not suing bar's landlord within limitation period — Plaintiff alleging that she only became aware of claim against landlord when she learned during tenant's examination for discovery that landlord participated in design and construction of stage — Plaintiff commencing action against landlord five years after accident — Landlord's motion for summary judgment dismissing action as statute-barred dismissed — Tenant never suggesting that landlord was liable — Limitation period starting to run from date of tenant's discovery.
The plaintiff was injured when she fell off an elevated dance stage at a bar. She sued the bar for damages. She did not sue the bar's landlord within the two-year limitation period. Five years after the accident, after learning that the bar's insurer had become insolvent, she commenced an action against the landlord. She alleged that she learned for the first time that the landlord was involved in the design and construction of the stage when the tenant was examined for discovery. The landlord brought a motion for summary judgment dismissing the action as statute-barred.
Held, the motion should be dismissed.
Neither the tenant nor its insurer or adjuster ever suggested that the landlord was liable. The tenant made no claim over in its defence of the plaintiff's action. Thus, the plaintiff was never put on notice that there was another party alleged to be liable for the claim that she had asserted against the tenant. A plaintiff does not have to seek information from adverse parties prior to discovery, in circumstances where those adverse parties have no legal obligation to provide the information. The limitation period began to run from the date of the tenant's discovery. The claim against the landlord was commenced within the limitation period. [page261]
Bailey (Litigation guardian of) v. Canadian Athletes Now and Wow Group, [2012] O.J. No. 4056, 2012 ONSC 4955 (S.C.J.); Madrid v. Ivanhoe Cambridge Inc. (2010), 101 O.R. (3d) 553, [2010] O.J. No. 1872, 2010 ONSC 2235, 188 A.C.W.S. (3d) 402 (S.C.J.), apld
Other cases referred to
Aguonie v. Galion Solid Waste Material Inc. (1998), 1998 954 (ON CA), 38 O.R. (3d) 161, [1998] O.J. No. 459, 156 D.L.R. (4th) 222, 107 O.A.C. 115, 17 C.P.C. (4th) 219, 77 A.C.W.S. (3d) 520 (C.A.); Hryniak v. Mauldin, [2014] 1 S.C.R. 87, [2014] S.C.J. No. 7, 2014 SCC 7, 314 O.A.C. 1, 453 N.R. 51, 2014EXP-319, J.E. 2014-162, EYB 2014-231951, 95 E.T.R. (3d) 1, 12 C.C.E.L. (4th) 1, 27 C.L.R. (4th) 1, 21 B.L.R. (5th) 248, 46 C.P.C. (7th) 217, 37 R.P.R. (5th) 1, 366 D.L.R. (4th) 641, 2014EXP-319, J.E. 2014-162
Statutes referred to
Limitations Act, 2002, S.O. 2002, c. 24, Sch. B, s. 5(1), (a), (b), (2)
Rules and regulations referred to
Building Code, O. Reg. 332/12 [as am.]
MOTION for summary judgment dismissing an action.
Barbara Opalinski and William G. Scott, for plaintiff.
Jay A. Skukowski and Erin Atkinson, for defendant Festival Hall.
[1] CORBETT J.: — This motion for summary judgment first came before me on March 21, 2014. Pertinent portions of my endorsement from that day are:
This is a motion for summary judgment based on a limitations issue. The plaintiff fell off a dance stage at a bar and broke her arm seriously. At this stage I would characterize the claim as less than catastrophic but by no means trivial.
The plaintiff fell on May 13, 2006. She sued the bar where she had fallen. The bar and its insurer defended. The bar has since closed. Unfortunately for the plaintiff, the bar's insurer has become insolvent.
The plaintiff did not sue the owner of the premises on which the bar was located, the bar's landlord. After learning of the bar's insurer's insolvency, she commenced this claim in 2011, five years after her injury.
The applicable limitations period is two years.
The plaintiff relies upon the "date of discoverability". She argues that she did not learn that she could have a claim against the owner until discovery of the tenant, during which she learned (a) that owner was entitled to approve tenant's improvements, pursuant to the lease; and (b) owner did, in fact, participate in the design and construction of the dance stage from which the plaintiff fell.
Plaintiff's counsel described himself as an experienced solicitor in the area of "occupier's liability" claims. He agrees that he knew that in some cases a landlord could have liability. But he says that he does not name landlords in [page262] all cases -- not without evidence that points to liability beyond the mere status of being the landlord.
It is not clear to me what the standard of care is for a solicitor in this circumstance. On the one hand, the effect of a limitations period should not be defeated by delaying reasonable inquiries until examinations for discovery. On the other hand, the courts do not wish to encourage a profusion of meritless claims against landlords, "just to be on the safe side". And this court does not wish to state a principle that could establish a "bright white line" on this issue without the benefit of expert evidence. I am heartened in this conclusion by the statement of Mr. Moscato and Ms Miller-Hall in their paper "Occupier's Liability: A Plaintiff's Perspective" (OBA, Defending Occupier's Liability Claims (Feb 7, 2011), at pp. 3-4, where they write:
It is getting increasingly difficult to add third party contractors as Defendants to an action after the two year limitation period has passed, which makes this preliminary [investigation] step even more important. It is unwise to simply wait until examination for discovery to conduct this type of inquiry. If this step is taken at the outset to ascertain all proper parties, the Plaintiff's counsel has done their due diligence and it is up to the Defendants to provide the information.
That which is "unwise" may or may not fall below the standard of care for the solicitor.
The issue on this motion is discrete and need not await a full trial on all issues. It can be resolved on the record before me with some expert evidence on the standard of care. Order to go for the trial of that issue before me[.]
Summary Judgment
[2] I am satisfied that the limitations issue may be decided by way of summary judgment, as urged by the defendant Festival Hall.[^1] The facts are not in dispute. The one issue addressed unsatisfactorily in the original motion materials relates to the standard of care of the reasonable solicitor investigating an occupiers' liability claim. This standard is relevant to assessing whether the plaintiff took reasonable steps to investigate her claim at the outset, which in turn is relevant to whether her claim against the landlord arose at the time of her injury or was not reasonably discoverable until the examination for discovery of the tenant. Subsequently, the standard of care was fully addressed in the opinions of the expert witnesses, and that evidence was fully explored before me at the second return of the motion. I am now satisfied that I have a full record on the limitations issue, and that no materially better appreciation of this evidence would be gained in a full trial. [page263]
Material Facts Are not in Dispute
[3] The claim against the nightclub, Republik, was commenced within two years of Ms Galota's injury (court file No. CV-11-439225).
[4] Republik did not own the premises at which its business was located. It was a tenant. The defendant Festival Hall owned the premises and was Republik's landlord. These facts were available at the time by searching title to the property.
[5] Examinations for discovery of Republik in the initial action were conducted on November 11, 2009. The plaintiff says that it was at this time that she and her solicitor learned for the first time that Festival Hall "was involved with the construction of the elevated dance floor" and that it was "constructed without proper permits and likely in violation of the Building Code.”[^2]
[6] In the plaintiff's solicitor's mind, the "guiding issue" in determining the proper defendants to the claim "was who had jurisdiction, care and control of the area over which Ms Galota fell". Initially, he concluded that the operator of the bar was responsible.
[7] The plaintiff's solicitor characterized the initial claim as focused on day-to-day operations of the bar, something that would ordinarily be the responsibility of the tenant and not of the landlord (failure to supervise customers, over-serving customers with alcohol, failing to replace light bulbs). However, the original statement of claim raised the physical condition of the elevated dance floor as a potential basis of the claim. It alleged that the negligence of Republik caused or contributed to the plaintiff's injuries on the basis that (among other things)
it failed to erect fences or otherwise close off the elevated dance floor to prevent people from using the area or from falling off it (para. 5b.);
it failed to install or provide appropriate lighting in the elevated area of the dance floor (paras. 5c., 5q.);
it failed to employ such safeguards and precautions as would normally have prevented the elevated dance floor from becoming dangerous including, but not limited to, replacing burnt out light bulbs, the placement of handrails, and/or the use of traction or grip pads on the dance floor (para. 5m.). [page264]
[8] I conclude that the inherent hazard posed by the elevated dance floor was an obvious issue, in and of itself, from the outset of the claim, and was adverted to in some of the particulars alleged in the original claim.
The Issue on this Motion
[9] The issue is when the plaintiff discovered or should have discovered that she had a potential claim against Festival Hall in relation to the inherent hazard posed by the elevated dance floor. Subsection 5(1) of the Limitations Act, 2002, S.O. 2002, c. 24, Sch. B provides:
5(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;
(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).[^3]
[10] Subsection 5(2) of the Limitations Act, 2002 provides:
5(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.[^4]
[11] This case turns on the application of s. 5(1)(b), a codification of the common law principles of discoverability.[^5] The focus is on the claims asserted against Festival Hall respecting the construction of the elevated dance floor. The question is when Ms. Galota first ought to have known about the four factors in s. 5(1)(a) in respect to those claims. [page265]
[12] Factors (i) and (iv) were satisfied at the time of the injury or very shortly thereafter: Ms. Galota knew then that she had been injured in circumstances where a lawsuit was an appropriate way for her to proceed. So the case turns on factors (ii) and (iii).
[13] Factor (ii) focuses on an "act or omission". In her original claim, the plaintiff identified several acts or omissions that she alleged caused or contributed to her injury:
-- the elevated dance floor was overcrowded;
-- Republik failed to supervise its patrons;
Republik over-served alcohol to its patrons and as a result some were "very intoxicated" on the dance floor, posing a hazard to others.
As particularized above, she also identified the design and construction of the dance floor as acts or omissions causing or contributing to her injury: the dance floor was allegedly elevated, without railings, and poorly lit.
[14] The plaintiff argues that she and her counsel learned for the first time at discovery that the dance floor may not have complied with the Building Code, O. Reg. 332/12 and that it may have been constructed without required permits. The extent to which the dance floor complied with the Building Code is evidence that may be relevant to whether the dance floor posed a hazard and whether a potential defendant was negligent. It does not raise the issue of whether the dance floor was hazardous -- that issue was raised from the outset, by the circumstances of the plaintiff's injury.
[15] I conclude that the plaintiff should have known, and did know, about factor (ii) in respect to the allegedly dangerous condition of the dance floor at around the time of her injury, in 2006.
[16] So the limitations issue turns on factor (iii): when did the plaintiff know, or when should she have known, that the hazardous condition of the elevated dance floor was a result of an act or omission by Festival Hall?
[17] I agree with the plaintiff that it would be inappropriate to name landlords as defendants in every case of an occupier's liability claim against a tenant. On the other hand, to satisfy the third branch of the test under s. 5(1)(a), for the purposes of s. 5(1)(b) of the Limitations Act, 2002, the plaintiff must investigate on a reasonable basis with a view to determining the proper defendants to the claim. In this case, this would mean [page266] identifying the condition of the elevated dance floor as a basis for alleged liability and the persons apparently responsible for it. This requires a plaintiff to make reasonable investigation of her claim. It does not, however, require a pre-discovery discovery of an adverse party.
The Expert Evidence
[18] The plaintiff relied upon the expert opinion of James M. Regan and the defendant relied upon the opinion of Richard H. Shekter, both senior experienced litigators. I accept both as qualified experts on the standards of practice in occupiers' liability claims.
[19] Mr. Shekter, in his summary of his assumed facts, noted that plaintiff's counsel did not do the following things in investigating this claim at the outset:
either attend or arrange for someone to attend at the bar to examine the premises generally or the elevated dance floor in particular. By the time a structural engineer was retained, the business had closed;
arrange for measurements or photographs of the scene in general or the dance floor in particular;
retain the services of an engineer, building inspector or contractor to determine if there were any Building Code or by-law restrictions or infractions relevant to the incident;
-- request a copy of the lease;
request information concerning the persons(s) responsible for constructing the elevated dance floor.
Mr. Shekter's summary is correct on these points: The plaintiff and her solicitors did not investigate these aspects of the claim at the outset. In Mr. Shekter's opinion, these were all steps that should have been taken during the initial investigation of the claim if the condition of the elevated dance floor was thought to have caused or contributed to the plaintiff's injuries. I agree that it would have been wise for the plaintiff to have undertaken some or all of the first three things in order to preserve evidence relevant to her claim. I do not agree that the plaintiff was obliged to request the lease or information about contractors or subcontractors -- those are inquiries that could only have been made of potential adverse parties.
[20] Preserving evidence of the condition of the elevated dance floor would not, itself, lead to discovery of information [page267] about the involvement of Festival Hall. Only by inquiries of the tenant, or Festival Hall itself, could this information have come to light.
[21] The plaintiff put the tenant on notice of her claim, and the tenant put the matter in the hands of its insurer, which in turn appointed an adjustor. None of the tenant, the insurer or the adjustor suggested that liability rested on the landlord or on a contractor or subcontractor. The tenant made no claim over in its defence of the plaintiff's action. Thus, the plaintiff was never put on notice that there was another party alleged to be liable for the claim that it had asserted against the tenant.
[22] These circumstances place this case within the principles articulated by Lauwers J. (as he then was) in Madrid, and M.L. Edwards J. in Bailey. I agree with my colleagues that "[i]t would not be in the interests of justice to encourage an overly muscular development of the concept of pre-discovery due diligence".[^6] I adopt the reasoning of Lauwers and Edwards JJ. in these cases: the plaintiff does not have to seek information from adverse parties prior to documentary and oral discovery, in circumstances where those adverse parties have no legal obligation to provide the information.
[23] I accept that the plaintiff did not know the terms of the lease or of any involvement by the landlord with the design and construction of the elevated dance floor before the examination for discovery of Republik in 2009. I conclude that the plaintiff was not put on notice of, and did not show a want of diligence in investigating the potential involvement of, the landlord in the design and construction of the elevated dance floor. Thus, I find that the plaintiff has defeated the presumption established in s. 5(2) in respect to factor (iii), and thus that the limitations period as against Festival Hall began to run upon discovery of the tenant in 2009. It follows that the claims against Festival Hall, commenced less than two years later in 2011, are not out of time. The motion for judgment is dismissed and it is ordered, on a final basis, that the plaintiff's claims against the defendant Festival Hall are not precluded by the Limitations Act, 2002. [page268]
[24] If the parties cannot agree on costs of the motion, then the plaintiff shall make brief written submissions by October 23, 2015, and Festival Hall shall make brief responding submissions by November 6, 2015.
[25] One further issue must be addressed. It would undermine, to some extent, the benefit of the summary judgment process followed in this case on the authority of Hryniak v. Mauldin, supra, to precipitate multiple appeals. I have decided the limitations issue on a final basis but the action remains outstanding. It strikes me that the sensible way in which to proceed is for this court to remain seized with this case, and that the deadline for any appeal from this decision be extended until the final disposition of this action on its merits at the trial level, so that all appeal issues can be presented in a single appeal. However, I did not hear submissions from the parties on this point. If the parties cannot agree on how appeal rights from this decision ought to be addressed, then they may make written submissions on this point on the same schedule that applies to their costs submissions.
Motion dismissed.
Notes
[^1]: Hryniak v. Mauldin, 2014 SCC 7, [2014] 1 S.C.R. 87.
[^2]: Plaintiff's factum dated March 18, 2014, para. 4.
[^3]: Limitations Act, 2002, s. 5(1).
[^4]: Limitations Act, 2002, s. 5(2).
[^5]: Aguonie v. Galion Solid Waste Material Inc. (1998), 1998 954 (ON CA), 38 O.R. (3d) 161 (C.A.).
[^6]: Madrid v. Ivanhoe Cambridge Inc. (2010), 101 O.R. (3d) 553, 2010 ONSC 2235 (S.C.J.), per Lauwers J. (as he then was), quoted in Bailey (Litigation guardian of) v. Canadian Athletes Now and Wow Group, 2012 ONSC 4955 (S.C.J.), para. 8.
End of Document