COURT FILE NO.: CV-11-00437452
MOTION HEARD: 20150425
REASONS RELEASED: 20151019
SUPERIOR COURT OF JUSTICE – ONTARIO
BETWEEN:
BARBARA ANITA CRESCENTINI
Plaintiff
and
KAYLA ANN NUGENT and MANJIT SINGH BENIPAL
Defendants
BEFORE: MASTER D. E. SHORT
COUNSEL: Harlan Pottins Fax: 416-649-0001
- for the Plaintiff
Candace Mak Fax: 416-368-0231
- for Defendant Benipal
RELEASED: October 19, 2015
Reasons for Decision
I. Overview
[1] Plaintiff moves to set aside a registrar’s dismissal of this action for abandonment under the previous form of Rule 48. Counsel for the defendant vehicle owner Benipal resists the motion.
[2] Six years ago, a rear end collision occurred at the corner of Spadina and Front Street in downtown Toronto. The plaintiff was rear-ended by a vehicle apparently driven by the defendant Nugent and owned by the defendant Benipal
[3] The plaintiff suffered injuries that required surgery and retained the Krylov law firm to bring an action on her behalf.
[4] The accident happened on October 25, 2009. The statement of claim was issued on October 18th, 2011.
[5] The service of the statement of claim seems to have been a very difficult process in this case. In particular, Ms. Nugent seems to have moved frequently and may have moved to Newfoundland at some point in time.
[6] This action was dismissed as abandoned on February 28, 2013, under then Rule 48.15(1)
[7] The Case History maintained by the court indicates that a notice that the action was going to be dismissed as abandoned was sent on April 16, 2012. (Form 48E). Such a notice was normally generated if “more than 180 days have passed since the originating process was issued” and “no defence has been filed”. In order for an order to dismiss the action to be made, the registrar must give 45 days’ notice to the plaintiff that the action will be dismissed as abandoned. That notice seems to have been generated on April 16, 2012, which was the date 180 days following the date of the issuing of the statement of claim.
[8] The precise language of section 48.15 (1) at item 5 establishes the following condition “the registrar has given 45 days notice in form 48E, that the action will be dismissed as abandoned.”
[9] I note in comparison that Subsection 48.15 (2) requires that the registrar shall serve a copy of the order made under sub rule (1) dismissing the action.
[10] The affidavit of Charleen Lewis filed on behalf of the plaintiff, reads in part, as follows:
I am a legal assistant at Krylov & Company, Barristers, counsel for the plaintiff in this action, and as such have knowledge of the matters to which I hereinafter depose.
To date, I have been advised and verily do believe that our office did not receive a notice that the action will be dismissed from the court.”
[11] Is it sufficient that the registrar issue and mail a notice, regardless of whether or not it is in fact received by the law firm? If the law firm proves that it did not receive a copy of the notice, is the order invalid, ab initio? Is the above affidavit sufficient “evidence” that no notice was “given” or received?
[12] In this case it would seem that the practice generally followed by the court office of not noting a party in default for a delay while any motion is pending before the court, may have occurred in this case.
[13] Here, a motion regarding service was originally scheduled by the plaintiff for August 15, 2012. While this motion did not address the pending expiry of the 180 day abandonment period, it may well have been filed within the 90 day period following the issuance on April 16 2012 of a Form 48E. Neither the Notice of Motion or his Order address extending the period for filing a defence.
[14] The August motion was adjourned on the initial return date, and ultimately heard by Master Muir on November 26, 2012.
[15] At that time I suspect my colleague was not satisfied with the extent of service attempts to date. As I note that Master Muir was provided with a draft order that contemplated terms providing for service on Ms. Nugent by mail to an address in Newfoundland or for an alternative form of service upon “State Farm, the insurance company of the owner of the vehicle she was driving at the time of the accident,”.
[16] Master Muir’s deleted out both those suggested provisions and simply extended the time for service upon the defendant Nugent to February 28, 2013, a date 3 months after the date he made his order.
[17] . When no proof of service of the pleading on that defendant was filed with the court by that date. At that point in time there was no longer any active motion pending.
[18] . As there was no longer any pending proceeding blocking blocking the system from generating the appropriate dismissal for default and action was dismissed as abandoned on February 28, 2013.
[19] However Master Muir’s Order clearly did validate the service of the statement of claim as of on June 3, 2012 upon the defendant Benipal.
[20] I note that the only defendant represented by State Farm before me is Mr. Benipal. However there is no clear evidence before me as to when his insurer actually first became aware of this accident. As well there is no indication that any defence was ever filed on Mr. Benipal’s behalf nor any indulgence requested or granted.
[21] Oddly I note the preamble to Master Muir’s Order reads in part “and being advised that the Defendants are not opposing the motion”.
[22] In response to my enquiry during the course of argument, counsel for the plaintiff has now advised that that State Farm had not been served with the motion material prior to the point when counsel appeared in front of Master Muir.
[23] Thus there was no specific proof before me as to whether Mr Benipal, or anyone else, was served with notice of that motion or a copy of Master Muir’s order.
[24] Assuming they were served, the failure of State Farm to file a defence either within the June 3 2012 delivery of the claim or within 30 days of the defendant Benipal apparently not opposing the order validating service and that order being made is of concern to me. It would seem clear that when the registrar’s office evaluated the status of this 2011 action in February 2013, it was appropriate under the Rules for the Court to issue the order dismissing the action as abandoned.
[25] Now some two more years later I heard this motion where that dismissal is sought to be set aside.
II. Defendant’s Position
[26] In material sworn March 9, 2015 one of the counsel for the insurer is critical of the efforts made to serve as Nugent and the delay in making those efforts. His affidavit reads in part as follows:
We are advised by Trish Bowden, the adjuster handling the matter on behalf of State Farm, that State Farm may have provided an automobile liability policy to the defendant, Manjit Singh Benipal and it may be asserted that he has indemnity coverage pursuant to the policy of insurance for this claim.
Trish Bowden advises that State Farm is not the insurer of the defendant Kayla Ann Nugent.
Trish Bowden further advises that the first notice State Farm had with respect to this claim was upon receipt of a letter from plaintiff’s counsel dated December 18, 2013.
This letter enclosed a copy of a Notice of Motion seeking an Order setting aside the Dismissal Order, substituted service on State Farm Insurance Company and an Order extending time for service on the defendant, Kayla Ann Nugent. No Affidavit or other supporting materials was included. …
I am advised by Michael W. Chadwick, the solicitor with carriage of this matter, and do verily believe that he was retained by State Farm Insurance Company on January 14, 2014.
A review of Charleen Lewis' affidavit shows that although three attempts were made to serve the defendant, Kayla Ann Nugent within the six month period for serving the statement of claim, no other steps were taken to serve the defendant, Manjit Singh Benipal until April 23, 2012 which is outside of the six month period for serving the statement of claim.
A review of the affidavit of Charleen Lewis notes that the defendant, Manjit Singh Benipal was served by way of an alternative to personal service on June 3, 2012. This service was validated by the Order of November 26, 2012 of Master Muir.
According to the affidavit of Charleen Lewis, an address was found for the defendant, Kayla Ann Nugent by way of a report done by CKR Global. It would appear that the report is dated April 16, 2012 which is two days prior to the expiration of the six month limitation period.
A review of the affidavit of Charleen Lewis discloses that following the Order of Master Muir, dated November 26, 2012, extending the time to serve Kayla Ann Nugent, it would appear that no steps were taken until February 14, 2013, two weeks prior to the expiration of the extended deadline for service of the statement of claim when an e-mail was sent to a process server to attempt to serve the defendant, Kayla Ann Nugent.
According to the affidavit of Charleen Lewis, the process server required more information which plaintiff’s counsel was unable to provide.
The action was dismissed as abandoned on February 28, 2013.
From a review of the affidavit of Charleen Lewis, it would appear that no steps were taken to extend the deadline by Order of Master Muir dated November 26, 2012.”
Given the fact that State Farm is not the insurer of Kayla Ann Nugent and the limited number of steps taken to serve the defendants within the six month period for serving the statement of claim mandated by the Rules of Civil Procedure and then within the extended time by way of Order of Master Muir, this is a fit and proper circumstance in which to dismiss the plaintiffs motion. [my emphasis throughout]
[27] Ms. Nugent remains unserved. Apparently based on the above affidavit’s 6th paragraph Mr. Benipal did not make his insurer aware of the accident at the date of its occurrence in 2009 nor when he received the materials that were personally served upon his daughter at his residence on June 3, 2012 and ratified by Master Muir’s order of November 2012.
[28] In such circumstances ought the Registrar’s dismissal to be set aside?
III. Motion to set aside Default Judgment
[29] The plaintiff’s undated notice of motion to set aside the dismissal was first issued with a return date of December 20, 2013, some ten months after the dismissal. In the circumstances I do not regard this period of delay as being so inordinately long as to prevent the order being sought being granted for that reason.
[30] Various adjournments on consent, by at least 4 different Masters, carried the matter forward another year until I finally heard the matter in April of 2015.
[31] Shortly after this motion was argued. I received email communications from both counsel. Ms. Mac advised that “State Farm is denying coverage to Ms. Nugent, because the vehicle owned by Mr. Benipal (my client) was driven by Ms. Nugent without Mr. Benipal’s consent.”
[32] In response Mr. Pottins, in part, wrote:
“At the risk of getting into further arguments, I would just like to advise that this email correspondence is the first time we have heard that there was a consent issue between the defendants.
As such, a new limitation period has arisen for us to bring a motion to add the Plaintiffs own insurer to this action, a potential party whose position we are not aware of.
Now that we know the defendant driver Kayla Ann Nugent will not be defended at all by the Defendant Owners insurer ( not even as a statutory third party), we know that Ms. Nugent, who we have not been able to locate, and who has not responded to this motion, has not given any opposing evidence.
The only Defendant we have at the moment arguing against reinstating this action (with no allegations of prejudice) is one whose position is that they are not liable for any damages anyway.”
[33] While I do not endorse in any way the email exchange with the court while the matter was under reserve; in the circumstances the positions taken by the parties help to clarify the present situation to a degree.
[34] While admittedly, it is difficult to prove a negative. It seems to me that hearsay without indicating what processes are in place to ensure mail is noted as received, etc. and simply saying “we did not get it”, without referring to the firm’s filing system, their data intake or any other process to deal with such notices, results in this portion of the affidavit not being entitled to much weight.
[35] While we do not have an affidavit from counsel with carriage fully explaining the causes of the delay; we do have a clear affidavit from the plaintiff personally deposing:
“7. As it was my intention, to proceed with this litigation, I instructed my lawyer, Mr. Pottins, to take steps to move this matter toward trial.
8 t had never been my intention to abandon my claim, and I had always been under the impression that my Action was proceeding toward trial.
Immediately upon learning that the Action had been dismissed, I instructed my lawyer, Mr. Pottins, to take the necessary steps to have the Action reinstated.
It is, and always has been, my intention to proceed with my claim, and to proceed to trial, such that my case can be resolved in a fair and just manner, based on its merits.
I have a very clear memory of the accident and its aftermath, which has not faded over time.
I verily believe I will be greatly prejudiced if my Action is dismissed, and I am denied the opportunity to have my case heard in Court.
IV. Developing Case Law
[36] In Khan v. Sunlife, 2011 ONCA 650, the Court of Appeal confirmed that at a Status Hearing the plaintiff must demonstrate to the Court’s satisfaction that:
i. He has an acceptable explanation for the litigation delay; and
ii. If the action is allowed to proceed the defendants will not suffer non-compensable prejudice.
[37] Here the action has already been dismissed and similar questions need to be addressed.
[38] The type or category of evidence from the plaintiff that will satisfy the first element is evidence that unexpected or unusual contingencies have made it impossible for the plaintiff to comply with the timing provisions in the Rules of Civil Procedure. Otherwise, for example plaintiffs are expected to be able to set their actions down for trial within two years or to restored the action to the trial list within 180 days as required by Rule 48. [see 119658 Ontario v. 6274013 Canada Ltd., 2012 ONCA 544 at para. 19,]
[39] Here the plaintiff’s unchallenged evidence is that she has always intended to pursue this action and has taken steps to move the action forward. She is not responsible in any way for causing the delay in issue.
[40] Having regard to the history and context of this case, the plaintiff submits that the court has been provided with an acceptable explanation for the delay.”
[41] In considering maintaining the dismissal of a case for delay, the Court will balance two competing values: (i) the need to enforce the Rules in a way that ensures timely and efficient justice, in the interests of plaintiffs, defendants, and society in general” and (ii) the interest of society and the parties in the resolution of disputes on their merits and in the availability of flexibility to avoid potentially draconian results, by providing the opportunity for parties to offer a reasonable explanation for delay when it takes them beyond established timelines.” While the courts will not take a mechanical or formalistic approach to the application of timelines it has been observed in a similar situation that “rule 48.14 was designed to have some teeth”. [see Kara v. Arnold, 2014 ONCA 871 at para. 10,]
[42] I recognize the guidance approved by our Court of Appeal over five years ago in Riggitano v. The Standard Life Assurance Company, 2009 CanLII 23892 at para. 45; aff’d 2010 ONCA 70:
“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.”
[43] However this remains a court of equity and a contextual approach needs to be taken for each unique fact situation.
[44] In concluding their argument that the within action should be restored to active status, plaintiff’s counsel submits there is no evidence of non-compensable prejudice to the defendants in the case at hand.
[45] Having regard to the coverage issues now raised I agree with this submission. I am supported in this conclusion by the guidance concerning the balancing of the interests of the parties in 1196158 Ontario Inc. v. 6274013 Canada Ltd.(Supra. )There the Ontario Court of Appeal outlined the correct approach:
[19] Time lines prescribed by the Rules of Civil Procedure or imposed by judicial orders should be complied with. Failure to enforce rules and orders undermines public confidence in the capacity of the justice system to process disputes fairly and efficiently. On the other hand, procedural rules are the servants of justice not its master. We must allow some latitude for unexpected and unusual contingencies that make it difficult or impossible for a party to comply. We should strive to avoid a purely formalistic and mechanical application of time lines that would penalize parties for technical non-compliance and frustrate the fundamental goal of resolving disputes on their merits.
[46] In the case at hand, the action has been delayed because the plaintiff has been attempting to locate an individual who seems to move frequently and to not leave forwarding addresses. Her approach to this case from the moment of the collision appears to have been one of avoidance. That in no way is the plaintiff’s fault.
[47] In assessing the parties’ arguments I also reflected on these portions of the Court of Appeal’s recent decision in Carioca’s Import & Export Inc. v. Canadian Pacific Railway Limited, 2015 ONCA 592:
Prejudice
49 The issue of prejudice is a factual question. The plaintiff bears the onus of demonstrating that the defendant would suffer no non-compensable prejudice if the action were allowed to proceed. The mere passage of time cannot be an insurmountable hurdle in determining prejudice, otherwise timelines would become inflexible and explanations futile.
50 A defendant is not required to offer evidence of actual prejudice. However, the court is entitled to consider the conduct of the defendant in light of its assertions of prejudice. As Weiler J.A. noted in Fuller, it is an error for a judge considering dismissal for delay to fail to consider the respondent's conduct in relation to the question of prejudice: at para. 39.
[48] I have added my emphasis to a number of extracts from Justice van Rensburg’s recent observations in Carioca’s,:
“Delay
51 The motion judge's analysis focussed mechanically on whether blame could be attributed to the appellant at each stage of the litigation. Once he found delay, he failed to go on to weigh the evidence and evaluate whether the explanation provided was reasonable. Had he done so, he would have taken into account important factors such as the circumstances in which the action came to be struck from the trial list and the fact that the case was now ready for trial.
52 Applying too exacting a standard for restoring an action which has been struck from the trial list may well hinder the objective of an efficient justice system, as parties and counsel would argue over keeping matters on the trial list for fear that, once struck, they might never be restored. Fighting highly contested motions over cases being struck and restored to the trial list is not an effective use of scarce judicial and legal resources. Ontario courts are actively discouraging a "motions culture" among counsel, and the Supreme Court of Canada has called for a "shift in culture", citing the need for a process that is proportionate, timely and affordable: Hryniak v. Mauldin, 2014 SCC 7, [2014] 1 S.C.R. 87, at para. 28.
53 While this court has stated frequently that the plaintiff bears the primary responsibility for moving a case forward, it has also acknowledged that the conduct of a defendant is a factor, especially where a plaintiff encounters some resistance when trying to move the action along: 1196158 Ontario Inc., at para. 29. The suggestion that it is normal and acceptable for a defendant, if not to actively delay, to simply wait for the plaintiff to make the next move, may be based on a conventional view of litigation strategy. The objectives of timely and efficient access to justice, and effective use of court resources require all parties to play their part in moving actions forward, and for counsel to act in a way that facilitates rather than frustrates access to justice: Hryniak, at para. 32. For these reasons, although the burden of proof on the motion is on the plaintiff, the conduct of all parties in relation to the litigation is relevant in determining whether to restore an action to the trial list.”
54 The motion judge's approach here focussed almost exclusively on the appellant's conduct, and did not consider the overall dynamics of the litigation. This resulted in an imbalanced view …..”
55 …. Procedural rules cannot be mechanically applied but have to be interpreted in a contextual manner that pays heed to all relevant circumstances and consequences.
[49] Based upon my understanding of the history of this case I find the Plaintiff’s explanation for the delay in this case “acceptable”.
[50] Justice van Rensburg clarified as well the analysis necessary in considering the issue of prejudice that might be suffered by a party:
“Prejudice
57 The second part of the test involves a consideration of prejudice to the respondent if the action were allowed to proceed. The prejudice at issue is to the respondent's ability to defend the action as a result of the appellant's delay, not as a result of the sheer passage of time: MDM Plastics Ltd. v. Vincor International Inc., 2015 ONCA 28, at paras. 25 and 33. This portion of the analysis does require some apportionment of responsibility for the delay.
59 The motion judge was required to consider the evidence in deciding the prejudice issue: Fuller, at paras. 38-39. In this case, the action was ready for trial, oral discoveries had been completed relatively soon after the events in question, transcripts were available (unlike in Nissar), and the documents authored by the missing witness were available. The record of the litigation did not indicate any serious concern on the respondent's part about the delay. Its consent to the previous motion to restore the action to the trial list, and its passivity in "to be spoken to" court when the court struck the action of its own motion, both suggest that no non-compensable prejudice would result from the action being restored to the trial list: MDM Plastics, at paras. 34-36 and 39; Fuller, at para. 42.
V. Defendants’ Actions
[51] As part of their efforts to locate the defendant Nugent plaintiff’s counsel obtained a “3 year Driver Record with Address” in October of 2011 at the time the claim was issued. That document indicated an address which was subsequently determined to no longer be accurate. The Defendant’s status is recorded as “SUSPENDED, UNLICENCED, UNRENEWABLE”
[52] Of particular relevance are the reported Convictions and other actions concerning the defendant driver. The document reads:
“2010-08-05 FOLLOWING TOO CLOSELY-MOTOR VEHICLE.
OFFENCE DATE 2009/10/25
2010-08-05 FAIL TO REPORT ACCIDENT
OFFENCE DATE 2009/10/25
2011-03-11 SUSPENDED RE UNPAID FINE”
[53] Clearly the convictions related to the accident that gave rise to this claim. Ms. Nugent appears to have failed to successfully defend the charges against her arising out of the accident and failed to pay the fines imposed. As a consequence her Driver’s licence was suspended.
[54] In balancing the position of the two litigants before the legal system of Ontario it seems to me that the defendant is entitled to successful submit that the tipping point has been reached such that fairness before the law as between these two parties requires the reinstatement of the plaintiff’s action.
[55] I am satisfied as well that the defendant Benipal’s failure to defend ab initio (when he was substitutionally served) or within 30 days of Master Muir’s order ratifying such service contributed to the problems encountered in this case. But for the failure to promptly defend this dismissal would never have occurred. Why should the defendants be permitted to benefit from their own failure to file a timely defence?
[56] Moreover the addition of a new fact regarding a coverage issue after the motion was argued does not enhance the defendants’ position.
VI. Conclusion
[57] At some point this the sins of the counsel in file management must regrettably prejudice the position of a Plaintiff and as a consequence an action may prematurely ended.
[58] This is not such a case. There are many issues that need to be addressed and the most appropriate means appears to me is to allow the action (in some form) to continue.
[59] I continue to be guided by the proportionality rule:
General Principle
1.04 (1) These rules shall be liberally construed to secure the just, most expeditious and least expensive determination of every civil proceeding on its merits.
(1.1) In applying these rules, the court shall make orders and give directions that are proportionate to the importance and complexity of the issues, and to the amount involved, in the proceeding.
[60] I am satisfied that in this unique fact situation a fair trial of the plaintiff’s claims remains possible and the case is capable of being resolved on the merits.
[61] Liability for the accident seems fairly obvious. This is a rear end collision and it appears, based on the information presently before the court that it is unlikely the driver will to be able to respond in a meaningful way to a financial judgment, if one is ever obtained.
[62] Moreover, in my view it is highly possible that there is no real prejudice in proceeding without her, particularly as the plaintiffs own insurer, in all likelihood, will now be becoming involved in the action as a result of the recently raised coverage issues regarding the defendants.
[63] For the reasons outlined, I am now setting aside the registrar’s dismissal and restoring the matter to an active status. As well I am providing a period of 90 more days for effective service to be made or a motion scheduled for an order resolving the issues surrounding service upon Ms. Nugent.
[64] In the circumstances, this is a case where making “No order as to Costs” is probably overly generous to the plaintiff and her counsel. Nevertheless, that is the order that I find most appropriate in this case. Based on the foregoing analysis I am satisfied that this action should proceed and I am therefore simply allowing the plaintiff’s motion at this time.
R.119/DS __________________
Master D.E. Short