CITATION: Kuner v. Nguyen et al., 2015 ONSC 730
COURT FILE NO.: CV-13-3179-00
DATE: 2015-02-02
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Resham Kuner - Plaintiff
- and -
Lan Nguyen and Hoang Ono - Defendants
BEFORE: The Honourable Mr. W. M. LeMay
COUNSEL: Yousef Jabbour, for the Plaintiff
Tripta Sood, for the Defendants’ Insurer, State Farm Insurance Company
HEARD: January 22, 2015
[1] This is a motion that arises as a result of a motor vehicle accident that took place on January 6, 2011. The plaintiff commenced this claim by issuing a statement of claim on July 24, 2013, but did not serve either of the defendants until 2015. The plaintiffs have yet to serve the Defendant, Mr. Ono.
[2] The plaintiff is bringing a motion for a claim of substituted service on the defendants’ insurer, and a motion to extend the time for serving the statement of claim on the defendants. As part of the supplementary motion record that the plaintiffs filed at the hearing of this motion, they also asked for an order effecting service on one of the defendants, as well as an order effecting service on the other defendant through his motor vehicle insurer. The defendants, through their insurer, are bringing a cross-motion to have the plaintiff’s action dismissed for delay.
[3] For the reasons that follow, I have reluctantly accepted the view that the plaintiff should be given an extension to serve their statement of claim. As a result, the action will continue. However, as I indicated during the argument of this matter, I am also imposing a timetable on the parties for the completion of various steps. This timetable is peremptory to the plaintiff only and if the plaintiff fails to adhere to the timetable, the defendant is at liberty to move to have this action dismissed. The defendants, if required, can seek relief against this timetable. I expressly note that the defendants should not be held to the same strict requirements as the plaintiff under this timetable for the reasons set out herein.
[4] To be clear, the timetable is being imposed because the alleged cause of action in this case is nearly four years old and the delays in this case are the responsibility of the plaintiff and/or plaintiff’s counsel.
Background
[5] As noted above, the parties were involved in a motor vehicle accident on or about July 26, 2011. There is no dispute in this case that the Statement of Claim was issued on July 24, 2013, which was within the limitations period for this action. However, what is in dispute are the events that occurred next. I will now review the facts as outlined by the plaintiff and the defendant.
a) The Plaintiff’s Efforts at Service
[6] Based on the record that I was provided by the plaintiffs, the following facts appear to be accepted. The claim was issued on July 24, 2013. On or about July 26, 2013, one attempt was made to serve each of the defendants with the statement of claim. This attempt was not successful on either defendant.
[7] Counsel for the plaintiffs took no further steps to serve this claim on the defendants for a further seven months. Then, on or about February 27, 2014, after the deadline for the service of the statement of claim had passed, Ms. Lauren Kehoe, an associate lawyer with the plaintiff’s law firm conducted a 411 search for the purposes of locating the defendants.
[8] The next day, Ms. Kehoe also requested a motor vehicle and VIN search report for the Defendant Hoang Ono and the Defendant Lan Nguyen. No explanation was provided on the record by the plaintiff as to why these searches were not completed earlier.
[9] The searches for the Defendant Lan Nguyen revealed that she lived at 48 Gabrielle Road. Service had originally been attempted at 49 Gabrielle Road. In an affidavit sworn on November 4, 2014, the plaintiff’s law firm alleges that they had taken “all practical and necessary attempts to effect prompt service” of the statement of claim on Ms. Nguyen, and had been unable to effect service. These efforts were not disclosed in the original affidavit other than as set out above.
[10] Plaintiff’s counsel advised that the attempted service at 49 Gabrielle Road was a mistake because of a lack of clarity in the accident report. I have reviewed the accident report, which was filed on the motion record, and I note that on my reading of it the address for Ms. Nguyen appears to be 48 Gabrielle Road and that this document should not have been the source of any error. No reason was offered for this mistake on the part of plaintiff’s counsel.
[11] At the hearing of this motion, I permitted plaintiff’s counsel to file an additional affidavit that outlines further efforts to contact the defendants. The motion record had been served on counsel for the defendants the day before the motion. With respect to Ms. Nguyen, the affidavit revealed, inter alia, that in April of 2014 counsel for the plaintiff followed up with their process servers to see whether the claim had been served on Ms. Nguyen. It had not. On the materials that I have, no further efforts were made by the plaintiff to serve Ms. Nguyen until approximately a week before this motion was heard.
[12] At that time, the plaintiff’s arranged for service to be attempted at 48 Gabrielle Road. Service was successful because the Defendant Ms. Nguyen was at home. She admitted service and accepted the statement of claim. This sequence of events raises very serious questions about the attempts that plaintiff’s counsel made to serve Ms. Nguyen. If on the first attempt to serve her at home they were successful, one must ask why it took them more than eighteen months after the claim was issued to find her. The materials filed disclose no answer to this question.
[13] Plaintiff’s counsel argued that the failure to serve Ms. Nguyen in a timely way was because there was a misunderstanding about her address. Having reviewed the police report, no reasonable person could give this argument any force. The report clearly states that Ms. Nguyen lives at 48 Gabrielle Road. The one attempt to serve Ms. Nguyen at 49 Gabrielle Road was an error, and it is disappointing to the Court that counsel for the plaintiff chooses to transfer blame for this error to the police as a result of the claimed illegibility of the report.
[14] In short, the efforts of plaintiff’s counsel to serve Ms. Nguyen have been limited at best. Indeed, had the defendants advanced any specific claims of prejudice, I would have dismissed the plaintiff’s motion and granted the defendant’s motion.
[15] In terms of Mr. Ono, service has still not been effected. In addition to the efforts described above, plaintiff’s counsel arranged for one further attempt to serve Mr. Ono at his last known address in July of 2014. This attempt was unsuccessful and, as I read the plaintiff’s motion record, they are seeking to have me order substituted service on State Farm, Mr. Ono’s insurer.
[16] As disclosed below (in the section on next steps and costs), I am providing the plaintiff with a further opportunity to effect service on Mr. Ono, and directing State Farm to provide the plaintiff with information to assist in that service. However, I am declining to issue an order allowing the plaintiff to effect substituted service on State Farm at this time. The plaintiff will only be entitled to an order allowing substituted service on State Farm if it can demonstrate some diligence in attempting to serve Mr. Ono. It has not, to date, demonstrated such diligence.
[17] The plaintiff’s original affidavit respecting Mr. Ono disclosed no efforts to find him and/or serve this statement of claim on him other than the original attempt at service, and the attempt to find his motor vehicle registration information approximately a year ago. There is nothing in the supplementary affidavit, except a further attempt to serve him at his last known address, to show further efforts to effect service on him.
b) The Defendant’s Prejudice
[18] In addition to considering the plaintiff’s efforts to serve the statement of claim, the parties also spent considerable time on the issue of whether the defendants had suffered prejudice as a result of the delays in this matter. Based on the record that I was provided with by the defendants, I have ascertained the following.
[19] The insurer of the defendants, State Farm, was not notified of this claim until July of 2014, some three years after the motor vehicle accident. Defendant’s counsel advances this as a particularly significant delay, especially in light of the fact that the plaintiff made no serious efforts to serve this statement of claim until after the period for serving it had expired.
[20] Defendant’s counsel also asks that I consider the prejudice associated with the delay in three respects. First, she states that the opportunity to conduct surveillance on the plaintiff has been minimized. Second, she states that the defendants have lost the opportunity to conduct a timely defence medical on the plaintiff. Finally, she states that the defendants might have lost the opportunity to find potential witnesses in this case. When asked in oral argument, counsel for the defendant could not identify a specific missing witness or specific missing documents. This was merely a general concern.
[21] The observation that the concerns about prejudice are only general in nature is supported by the record. Counsel has provided an affidavit sworn by counsel for the defendants outlining her views on the general prejudice that the defendants have suffered. This affidavit does not contain any specific concerns, except for medical evidence.
[22] It is also worth noting that the only observation made by the plaintiff about prejudice is a bald statement that the defendants will not suffer any prejudice (see paragraph 12 of Ms. Verkhovets’ November 4, 2014 Affidavit). There is no evidence that the plaintiff has tendered to support this assertion.
c) Concluding Comments on the Facts
[23] Neither party disputes the facts that the other party alleges. However, there is a dispute as to what conclusions should be reached as a result of those facts. The plaintiff asserts that they have taken sufficient steps to serve the statement of claim on the defendants, and that I should order substituted service. They also argued that the time limits for serving the statement of claim should be extended. The defendants argue that the plaintiff has not taken steps to serve the statement of claim on the defendants, and that substituted service should not be ordered. Instead, the defendants argue that the plaintiff’s claim should be dismissed on the basis of the Limitations Act.
[24] I will address the arguments made by the parties. It is worth noting that the facts alleged by both parties are very thin for a motion of this significance. However, given the fact that the parties were prepared to argue this matter on the record before me, I am prepared to render a decision on it.
Argument of the Parties
a) The Plaintiff’s Argument
[25] The argument advanced by plaintiff’s counsel is, in essence, twofold. First, that the defendants cannot show any specific prejudice that they would suffer if this claim were to proceed. Second, that the Court should focus on the interests of the plaintiff rather than the conduct of plaintiff’s counsel in deciding this motion.
[26] Further, as part of their original motion record, the plaintiff asserted that he had “attempted all reasonable avenues of personal service of the Statement of Claim on the Defendants herein”. In other words, the plaintiff stated that they had done everything that they could to serve this statement of claim, and should be relieved of their obligation to do anything further, or to have effected service in a timely way.
[27] In support of his argument, counsel for the plaintiff directed me to the decisions in Armstrong v. McCall (2006 17248 (ON CA), 213 O.A.C. 229 (C.A.)), Mader v. Hunter (2004 17834 (ON CA), 183 O.A.C. 294 (C.A.)) and Chiarelli v. Weins ((2000) 2000 3904 (ON CA), 46 O.R (3d) 780. I have considered all of these cases in reaching my decision.
b) The Defendants’ Argument
[28] The defendants’ primary argument is that the plaintiff’s efforts to serve this claim on the defendants were woefully inadequate. As a result of these inadequacies, none of the defendants (including State Farm) were made aware of this claim until at least a year after the limitation period had expired.
[29] Defendants’ counsel went on to point out the three types of prejudice that I listed in paragraph 20 above. In terms of her materials, however, defendants’ counsel did not point to any specific prejudice relating to this case. Instead, the prejudices were general in nature.
[30] Defendants’ counsel direct my attention to Beckwith v. Salmon ([2014] O.J. No. 2812), a decision of Master Haberman on the issue of service. I have considered this case in reaching my decision.
Disposition
[31] In disposing of this matter, I begin with the efforts that the plaintiff’s counsel made to serve this claim on the defendants. I find those efforts to have been wholly lacking. The plaintiffs took no steps until mid-2014 to serve any of the defendants once they made a very cursory effort in July of 2013.
[32] If the test for relief under the Rules was solely the adequacy of the plaintiff’s efforts to effect service, then the plaintiff’s motion would fail.
[33] However, as noted in the Armstrong v. McCall decision at para. 11 (as below), the test for dismissing an action for delay was set out as follows:
[11] The test for dismissal of an action for delay is not in dispute. In my view, it is correctly stated at paragraph 4 of the reasons of the Divisional Court in an appeal from the master in Woodhealth Developments Ltd. v. Goldman (2003), 2003 46735 (ON SCDC), 66 O.R. (3d) 731 at 732:
Specifically, I accept as correct the principles applicable to motions to dismiss for delay derived by the learned Master from the case law and accurately summarized in the headnote at (2001), 2001 28019 (ON SC), 56 O.R. (3d) 658 as follows:
The principle to be applied on a motion to dismiss for delay is that the action should not be dismissed unless: (1) the default is intentional and contumelious; or (2) the plaintiff or his or her lawyers are responsible for the inexcusable delay that gives rise to a substantial risk that a fair trial might not now be possible. It is presumed that memories fade over time, and an inordinate delay after the cause of action arose or after the passage of limitation period gives rise to a presumption of prejudice. Where there is a presumption of prejudice, the defendant need not lead actual evidence of prejudice and the action will be dismissed for delay unless the plaintiff rebuts the presumption. The presumption of prejudice may be rebutted by evidence that all documentary evidence has been preserved and the issues in the lawsuit do not depend on the recollection of witnesses or that all necessary witnesses are available with detailed recollection of the events. If the presumption is rebutted then the action may still be dismissed if the defendant leads convincing evidence of actual prejudice.
[34] In determining whether to extend the time for service, the emphasis is generally on the specific prejudice caused by the delay, and not on the passage of time alone. Further, in making a decision on this issue, the Court must be mindful of the rights of the litigants, rather than the conduct of counsel.
[35] This passage, in other words, squarely raises the prejudice to the defendants in not allowing this action to proceed. In terms of considering the issue of prejudice to the defendants, the starting point is the decision in Mader v. Hunter, supra, where the Court of Appeal stated:
[4] The court is always reluctant to dismiss a potentially meritorious claim on grounds that do not address its merits. Unless the defendant can demonstrate prejudice in the sense that to grant the plaintiff the indulgence he or she seeks will prejudice the defendant’s ability to defend the claim, the indulgence will usually be granted on appropriate terms.
[36] As a result, the defendant has not outlined sufficient prejudice in their materials, and it is difficult to support a claim for prejudice on their behalf. As noted in the case law, memories fade. Further, in order to establish that missing documents or a failure to conduct timely surveillance on someone was prejudicial to the defendant’s case, specific evidence of specific prejudices would be required.
[37] The one area remaining in terms of prejudice to the defendants is the question of whether the plaintiff’s delay has denied the defendants a timely independent medical examination. This issue was dealt with by the Court of Appeal in Chiarelli v. Weins:
[11] The one area not addressed by the motions judge was the possible prejudice arising from a delayed defence medical. State Farm had requested an independent medical assessment Ms. Chiarelli in July 1989, not, however, to be considered its defence medical. The plaintiffs’ lawyer refused saying there was not yet enough medical information. State Farm never renewed its request. Still, the defence was entitled a defence medical and is still entitled to one if the action proceeds. [See note 1 at end of document] However, I consider any prejudice caused by a delayed defence medical to be slight. Because the defence typically is only entitled to one medical examination of the plaintiff, usually that examination takes place shortly before the trial when the most up-to-date medical information has been obtained. Thus, even if the statement of claim had been served on time, the defence medical would likely still have taken place several years after the accident. The added years caused by the delay in service will not appreciably affect the defence’s position, especially considering the voluminous medical information on Ms. Chiarelli now available to State Farm. Therefore, in my view, a delayed defence medical provides no basis for interfering with the motions judge’s order.
[38] While it is likely that this principle could be subject to the specific facts of a given case, there is no evidence available on the record in this case to allow me to deviate from the principles that the Court of Appeal has set out.
[39] Defendant’s counsel referred me to Master Haberman’s decision in Beckwith v. Salmon as noted above. I have reviewed that decision in detail. This decision is distinguishable on a number of bases. First and foremost, the claim in the Beckwith case was issued after the limitations period had expired. This decision, like the others set out above, balances the interests of a just resolution of the proceeding with unfairness and prejudice to the defendant.
[40] Second, in the Beckwith case, the plaintiff in that case had sustained an intervening fall that happened subsequent to her original accident. This intervening event, combined with the fact that the limitations period had not been met before the original claim was issued, formed a key part of the basis for Master Haberman’s decision. We simply have no evidence of any intervening events in this case, and the original claim was started in a timely way.
[41] In short, in the Beckwith case, there was actual prejudice that was substantiated in the record before the Court.
[42] In this case, there is simply not enough evidence of prejudice to the defendants to overcome the fact that this claim was issued (if not served) in a timely way. As a result, the plaintiff’s motions are granted to the extent set out herein, and the defendants’ motion is denied in its entirety.
Cost and Next Steps
[43] The plaintiff has been successful on these motions and the defendants have been unsuccessful. However, the plaintiff has requested an indulgence from the Court. In those circumstances, both parties are directed to provide me with their costs submissions simultaneously within fourteen (14) days of the date of the release of this decision.
[44] Further, the parties are directed that costs submissions are not to exceed three (3) single spaced pages, exclusive of bills of costs and any case law that they may seek to file. Any party that filed a bill of costs at the hearing of this motion is directed to refile their bill of costs.
[45] There shall be no reply submissions on costs without leave of the Court.
[46] In terms of the next steps, the plaintiff is entitled to the relief it seeks on such terms as are just. Having considered the entirety of the record in this case, I direct that the following are the terms that the plaintiff should be required to adhere to in order to receive the relief that they are seeking in this motion. As a result, the terms under which the plaintiff’s motion is granted are as follows:
a) State Farm is to have thirty (30) days from the date of this decision to provide the plaintiff with the last known address of Hoang Ono for the purposes of allowing the plaintiff to serve the statement of claim on Mr. Ono if they are in possession of this information
b) The plaintiff will have sixty (60) days from the date that they receive the information from State Farm to serve Mr. Ono with this statement of claim. If service is not effected on Mr. Ono in that time period, then the plaintiff will be required to seek an extension from the Court to effect service on Mr. Ono (either personally or by substituted service), and will be required to show that it took steps beyond merely relying on the information from State Farm to ascertain Mr. Ono’s address in order to obtain such leave. In the event that State Farm is not in possession of any information about Mr. Ono’s address, then the sixty (60) days in this paragraph will run from the date that State Farm (or its counsel) notifies plaintiff’s counsel that it has no information.
c) In the event that the plaintiff’s request for an extension, or for substituted service, is denied by the Court under paragraph (b), then the entire action against all defendants may be dismissed by way of a motion by one or more of the defendants.
d) Once service is effected on Mr. Ono, the defendants will have forty (40) days to deliver a statement of defence or statements of defence, as long as a notice of intent to defend is served and filed in accordance with the Rules of Civil Procedure by each defendant. No defence is due from any defendant prior to the expiration of the time period in this paragraph, and the time for Ms. Nguyen to serve her notice of intent to defend is 20 days from the date of the release of these reasons.
e) Once the statement of defence is delivered, the plaintiff has ten (10) days to deliver any reply.
f) After the time period in paragraph e) passes, the plaintiff then has twenty (20) days to deliver a sworn and complete affidavit of documents. In the event that the plaintiff fails to deliver the affidavit of documents in accordance with this direction, then the defendants can seek to have the action dismissed as against the plaintiff.
g) Within one hundred and twenty (120) days of a statement of defence being filed, the plaintiff will be produced for an examination for discovery. The plaintiff’s examination for discovery will take place prior to the examinations for discovery of the defendants, regardless of which party delivers its affidavit of documents first.
h) In terms of the IMEs that the defendant may seek in this case, the defendant is at liberty to request those IMEs in accordance with the Rules of Civil Procedure immediately upon issuance of this decision.
[47] I do not intend to Order any additional steps at this point, as the litigation process must take its course. Indeed, this is a very directive approach for the Court to take at the outset of litigation. I have chosen to impose this timetable on the parties, and the consequences on the plaintiff, as a result of the plaintiff’s very dilatory approach in moving this action forward. The defendants are entitled to some protection in the event that this dilatoriness continues. As a result, once the examinations for discovery have taken place, the parties may seek a further timetable from the Court. That timetable will, of course, be subject to the Rules of Civil Procedure, and I am not seized of this matter for any future issues.
W. M. LeMay, J.
Released: February 2, 2015