ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Peter Niro
Applicant
– and –
Societa Caruso
Respondent
John Michael Bray, for the Applicant
Gerard E. McAndrew, for the Respondent
HEARD: November 27, 2015
RULING ON MOTION
GAUTHIER J.
The Motion
1The notice of motion seeks the following relief:
a) An order striking out the application, or, in the alternative;
b) An order converting the application to an action.
2I received submissions on the motion on Friday, November 27, 2015.
3The respondent seeks an order dismissing the motion.
4The applicant (“Niro”) was, until May 2015, a member of the respondent club (the “club”), an Italian social and cultural club created in 1947.
5The club is an Ontario corporation and is governed by a Constitution and a Board of Directors composed of thirteen Directors, twelve of whom are elected every two years by the membership at large.
6Niro has been an active member of the club for a significant number of years.
7Ugo Rocca is also a member of the club, as is his wife, Sonia Rocca, who was employed by the club until March 2013.
8Ugo Rocca (“Rocca”) wrote a letter to the President of the club, on September 7, 2014, expressing his disappointment that his wife’s employment with the club had not been appropriately acknowledged following the end of her employment.
9On November 12, 2014, the club held its General Assembly Meeting. Niro and Rocca were, among others, present at the meeting. In the course of that meeting, Niro posed a question to the then President of the club, Diana Colilli (“Colilli”), relating to Sonia Rocca. Niro’s material says the question related to Sonia’s status, the reasons her employment ended, and whether health issues were the reason Sonia Rocca was no longer employed by the club.
10The club’s material indicates that Niro’s question related to Ugo Rocca’s September 7, 2014, letter referred to above.
11The unfolding of the November 12, 2014, events is in dispute.
12According to Niro, he had asked a legitimate question in a respectful tone. He was neither called to order nor asked to retract his question.
13According to the club, Niro’s question was out of order and should have been ruled as such. It was not, and what followed was “a humiliating attack” on the President. As a result of this “attack” the President Diana Colilli withdrew her nomination for the position of President. The only other candidate was Niro who, by virtue of being unopposed, became the incoming President.
14On November 25, 2014, Diana Colilli wrote a letter of formal complaint to the club, concerning the events of November 12, 2014, specifically relating to the conduct of Niro and Rocca, and alleging that the two individuals had planned and orchestrated the “public attack” which they carried out on her on November 12, 2014.
15At a subsequent meeting of the club’s Board of Directors, the Board considered Colilli’s letter of November 25, 2014, and determined that Niro should sit for an investigation before the Disciplinary Committee, in accordance with the club’s Constitution. Luisa Valle (“Valle”) was appointed by the Board as its representative on the Disciplinary Committee.
16On December 15, 2014, Valle, in her capacity as the Board of Directors Disciplinary Committee representative, wrote a letter to Niro advising him that he was being required to sit for an investigation.
17The letter went on to say:
As stipulated in Article III, Paragraphs 2-14 of the Società Caruso Constitution, you should now nominate a member in good standing to represent you. You will be notified in the near future of the date of the investigation.
18By correspondence dated December 29, 2014, Niro requested that the Board provide him with the reasons for the investigation and information in that regard.
19The Board responded by letter dated January 14, 2015. The letter made reference to the November 12, 2014, meeting. The letter characterized Niro’s attendance at the meeting as “questionable”, and his participation in the discussion about Sonia Rocca as “suspicious”. The letter went on to say the following:
Your presence suggested that the verbal attack was orchestrated by Mr. Ugo Rocca and yourself. The situation became more offensive and slanderous when Mr. Ugo Rocca became more abusive and demeaning in his discussion and arguments with our President. [Y]ou conferred with Mr. Ugo Rocca on several occasions which implies possible collusion on your part.
Kindly refer to our Società Caruso Constitution Article III Subsection 2-15 titled “Discipline of Membership” in regards to the required co-operation of all parties, if the member fails to comply with the Arbitrators [sic] request, the member can be suspended until the complaint is thoroughly investigated.
As stipulated in Article III Subsection 2-15 of the Società Caruso Constitution, the Board of Directors must appoint an Arbitrator for the investigation. The Board of Directors has appointed Chris Sheridan as the Arbitrator as such, you will need to advise us if you are in agreement with their choice or if not infavour [sic], please provide us with the name of your choice. If no one can agree on the Arbitrator, after three attempts the board can select the Arbitrator no discussion accepted.
In the registered letter, we had asked for you to appoint someone in good standing to represent you. To date, we have not received any information if you have in fact appointed a member to represent you and require the name of this individual for future contact and/or correspondence.
Also, please provide a complete listing of your possible witness(es) including their name, full address and phone numbers, to a maximum of five witnesses, who may be called to provide additional information on the incident that occurred on November 12th, 2014 at the Società Caruso General Assembly meeting.
Please confirm your attendance for the January 22nd, 2015 meeting and please provide requested information and material to our Committee by no later than January 19th, 2015.
20In mid-January 2015, Niro retained his counsel (counsel on the motion) to represent him at the hearing of January 22, 2015.
21On January 22, 2015, Niro attended at the hearing together with his counsel. At the commencement of the meeting, counsel requested an adjournment of the hearing for the following reasons:
a) No disclosure, production of evidence, or witness information had been provided and he and his client required time to review same in order to conduct their own investigation and present a full defence to the allegations made against Niro; and
b) Niro required the Board to specify the exact charge for which he was being investigated, in order to prepare a proper response and defence to the charge.
22Counsel also requested that the Board produce particulars of the evidence that it would use at the hearing, together with the identities of the witnesses, and summaries of their anticipated evidence.
23Following the making of those requests, counsel was asked by Colilli to leave the meeting as he was not a member in good standing of the club.
24Following counsel’s expulsion from the room, Niro requested that the hearing be adjourned to permit him to retain new counsel, and to have time to review the evidence and witness information so as to be capable of presenting a defence.
25The Chair of the Disciplinary Committee, Chris Sheridan (“Sheridan”), denied the request.
26A Mr. Contini, a member of good standing of the club, then acted as Niro’s representative on the Disciplinary Committee. The hearing proceeded. Four witnesses were called. Niro was not permitted to remain in the room while the witnesses gave their evidence, nor was he permitted to ask questions of the witnesses. The same procedure applied to the complainant, Colilli.
27Questions were asked by Sheridan, Contini, and Lina Sanchioni (“Sanchioni”), the representative for Colilli. The representatives, Contini and Sanchioni, had the opportunity to make representations to the Chair-Arbitrator, Sheridan. Sheridan reserved his decision and released a document dated March 17, 2015. The document consists of a one page letter signed by Sheridan, together with what Sheridan characterized as “a brief summary of our findings and my recommendations of disciplinary action against Niro.”
28The recommendations in the Sheridan report are the following:
To provide Mr. Peter Niro with a directive that he must write a letter of apology to the Boards [sic] Past President Mrs. Diana Colilli. In the letter, he must meaningfully profess his sorrow for the occurrence of the incident.
Then, Mr. N[e]ro must submit his letter of resignation removing himself from the position of President of the Societa Caruso Board of Directors effective immediately. He is not being expelled but he is resigning. This will allow him to run for office in the next called election.[.]
He has shown no remorse for his actions against Ms. Collili [sic] and other members of the club. He has little respect for the Constitution and Bylaws. As he incurred several infractions against the Constitution[.]on the evening of the disciplinary review. In conflict with Article III # 3,[,]4,[,]5[,]; Article IV #2; Article XII, #1[.];Article XII, #4. His actions on the evening of January 22, 2015
Mr. Niro must provide to the board a completed copy of a recent police check which is required for non profits [sic] associations, and facilities that have programming for children. Insurance Companies are requesting that all directors and officers complete the applications and have them processed by the Police.
Until such time that he provides a copy of the letter and addresses the members, his privileges at the club should be restricted or temporarily suspended. He must profess the importance of our Constitution and Bylaws.
Lastly, Mr. Niro should receive a letter of warning from the Past President and the Board of Directors advising him that his unacceptable conduct has placed him on notice that any future altercation(s) between himself and staff or other members will lead to an ultimate expulsion from the Caruso Club.
29I have reproduced certain portions of the Sheridan report, under the section entitled Conclusion:
It became more apparent that the two had seen an opportunity by interrupting the President to bring the issue back while humiliating our President. Confusion in dealing with out of order attempts was creating havoc amongst the members as they sat and watched Peter Niro and Ugo attack the integrity of the chair. They had purposely waited until Diana had read the minutes of the October 08 general assembly meeting and then Peter Niro asked Diana about the letter from Ugo in regards to Sonia’s dismissal. Diana had to interject and correct him on the fact that Sonia had decided on her retirement and was never terminated. The only other person referring to those same words was Ugo so it confirmed our suspicion that it was a planned effort on their part to attack and humiliate Diana. There was a hidden agenda as Mr. Niro and Rocca continued to be obnoxious and not co-operating when asked to cease and desist or leave. Mr. Rocca ignored the chair and continued to shout and scream and completely disrupt the meeting.
Mr. Niro did not observe correct procedure needed to recall for discussion and reconsideration of the letter as reported on in the minutes of Sept. 12. He bluntly asked the opening question on the Ugo Rocca letter and consistently challenged the chair was very upsetting and is a concern to us. Some feel that this action showed his true colors with minimal respect for women in power and for our Constitution….
She was humiliated and totally disgusted with [the] way she was treated by Rocca and Niro. Regardless of the level of verbal contact that may have occurred, due consideration for the rights of each member were stripped by the actions of Peter Niro and Ugo Rocca.
In my opinion, Mr. Niro was using barbaric tactics to upset the challenges from the election results.
30Niro believed and continues to believe that the Board’s purpose in initiating the disciplinary process against him was to ensure that he could no longer serve on the club’s Board of Directors and to ensure that he could no longer participate in the club’s decision making and functions.
The Application
31On August 18, 2015, a notice of application was issued on behalf of Niro against the club. Within the Application, Niro seeks the following relief:
a) a Declaration that the decision of the Board of Directors of Societa Caruso of May 21, 2015 to expel the Applicant from membership of Societa Caruso is null and void, and unlawful;
b) a Declaration that the decision of the Board of Directors of Societa Caruso of April 13, 2015 to accept and adopt the recommendations of Arbitrator Chris Sheridan is null and void, and unlawful;
c) a Declaration that the report and decision of Arbitrator Chris Sheridan of March 17, 2015 is null and void, and unlawful;
d) a Declaration that the disciplinary proceeding brought by the Board of Directors of Societa Caruso as against the Applicant is null and void, and unlawful;
e) an Order lifting the expulsion of the Applicant from membership of Societa Caruso;
f) an Order restoring the Applicant’s membership of Societa Caruso;
g) an Order restoring the Applicant as President of the Board of Directors of Societa Caruso;
h) an Order prohibiting the Respondent from re-instituting disciplinary proceedings against the Applicant based on the facts, allegations, evidence, charges and subject matters forming the basis of the disciplinary proceedings carried out against the Applicant on January 22, 2015;
i) an Order requiring the Respondent to retract all charges and allegations which formed the basis of the disciplinary proceedings carried out against the Applicant on January 22, 2015.
j) Costs of this Application;
k) Such further and other relief as this Honourable court may deem just.
32The grounds for the application, including additional grounds contained in the supplementary application record dated November 6, 2015, are as follows:
a) the decision of the Board of Directors of Societa Caruso to expel the Applicant from membership of Societa Caruso was made contrary to the Constitution and rules of Societa Caruso;
b) the decision of the Board of Directors of Societa Caruso to expel the Applicant from membership of Societa Caruso was not made in accordance with the principles of natural justice;
c) the decision of the Board of Directors of Societa Caruso to expel the Applicant from membership of Societa Caruso was made in bad faith;
d) the decision of the Board of Directors of Societa Caruso of April 13, 2015 to accept and adopt the recommendations of Arbitrator Chris Sheridan was made contrary to the Constitution and rules of Societa Caruso;
e) the decision of the Board of Directors of Societa Caruso of April 13, 2015 to accept and adopt the recommendations or Arbitrator Chris Sheridan was not made in accordance with the principles of natural justice;
f) the decision of the Board of Directors of Societa Caruso of April 13, 2015 to accept and adopt the recommendations of Arbitrator Chris Sheridan was made in bad faith;
g) the report and decision of Arbitrator Chris Sheridan of March 17, 2015 was made contrary to the Constitution and rules of Societa Caruso;
h) the report and decision of Arbitrator Chris Sheridan of March 17, 2015 was made contrary to the principles of natural justice;
i) the report and decision of Arbitrator Chris Sheridan of March 17, 2015 was made in bad faith;
j) the disciplinary proceeding initiated against the Applicant by the Board of Directors of Societa Caruso is unlawful;
k) the facts as set out in the Affidavit of Peter Niro sworn August 17, 2015.
The Club’s Constitution
33The club’s Constitution provides for disciplinary hearings and discipline of its members.
ARTICLE III Forfeiture, Expulsion and Discipline of Membership.
Such investigation shall be conducted by a special three-person Disciplinary committee, who shall be members in good standing; one appointed by the President or his/her designate, with the approval of the Board, one by the member involved and the third appointed and agreed upon by the two foregoing appointees. If the two parties cannot agree upon an arbitrator who is the third person, after three unsuccessful attempts, the arbitrator will then be appointed by the Board of Directors. Immediately after the investigation, the arbitrator will prepare a written report, which is submitted to the Board of Directors. The decision will be final and binding.
The member involved shall as a matter of right be entitled to personally appear along with the witness, before the Disciplinary committee or Board of Directors to offer evidence.
The Disciplinary committee may call and hear such witnesses and do all things considered necessary to carry out the investigation.
The Material on the Motion
34The material on the motion includes:
i. Niro affidavit, sworn August 17, 2015;
ii. Valle affidavit, sworn October 26, 2015;
iii. affidavit of Carol Lachapelle, a senior litigation assistant with the lawyers for the applicant Niro.
iv. the application record itself; and
v. a book of authorities delivered on behalf of Niro.
Position of the Respondent
35Mr. McAndrew, for the club, made a preliminary objection to the admissibility of the Lachapelle affidavit, suggesting that it runs afoul of Rule 39.01(4) of the Rules of Civil Procedure, in that the deponent fails to specify in the affidavit the source of the information upon which underpins the belief expressed by her in the affidavit.
36The first three paragraphs of the Lachapelle affidavit are reproduced:
I am a senior litigation assistant with the law firm of Orendorff & Associates, lawyers for the Applicant herein, and as such have knowledge of the matters I hereinafter deposed to.
I have reviewed the following documentation in relation to the herein matter:
a) Affidavit of Peter Niro, sworn August 17, 2015;
b) Affidavit of Luisa Valle, sworn October 26, 2015;
c) Affidavit of Juli Spooner, sworn November 4, 2015.
- Following my review of the above noted documentation and discussions with the lawyers for the Applicant, I verily believe that the facts necessary for the Court to adjudicate on the matters raised in this Application are not in dispute.
37The Lachapelle affidavit contains admissions and denials on behalf of Niro, and goes on to comment that certain facts are outside Niro’s knowledge, that Niro agrees with certain facts, and that certain facts are not disputed by Niro.
38I agree with Mr. McAndrew that the Lachapelle affidavit does not meet the requirements of Rule 39.01(4), and therefore should not be considered by me.
39It is suggested that what went on at the November 12, 2014, meeting as described in paragraph 9 of the Valle affidavit, and denied by Niro, are material facts in dispute, and are the facts that gave rise to the Disciplinary Committee’s investigation and hearing on January 22, 2015. The affidavit does not specify the source of the deponent’s belief as to what Niro knows, admits, or denies.
40According to Mr. McAndrew, those facts set out in paragraph 9 of the Valle affidavit, and described in the arbitrator’s report, relevant portions of which I have reproduced above, are the crux of the matter. The affidavits are in conflict about those facts.
41The court is entitled to receive the best evidence possible in addressing disputes and, in this case, it should receive viva voce evidence, and the proceeding should be by trial, and not by application where the evidence will consist of conflicting affidavits.
42Mr. McAndrew reminded me that proceedings are defined by the pleadings therein, and he drew my attention to the notice of application, in particular subparagraphs (h) and (i). In addressing those two claims for relief the court will, of necessity, he suggested, have to examine the events of January 12, 2014, the description of which is in dispute by both sides. It was also brought to my attention that certain of the grounds for the application refer to “bad faith”. An evidentiary foundation is required for a finding of bad faith. There is a dispute about the material facts which would be the basis for consideration of “bad faith”.
Position of the Applicant
43For his part, Mr. Bray submits that the application is not a forum for the re-litigation of the events that transpired at the club on January 12, 2014. Rather, the proceeding is whether the disciplinary process engaged by the club, was proper, fair, and in accordance with the club’s own Constitution.
44Niro raised such factors as sufficiency of notice, proper disclosure, right to counsel, right to representation on the Disciplinary Committee, conduct of the disciplinary proceeding, and the questioning of witnesses, as being the focus of the inquiry engaged by the application. Adjudication of the application does not require a trial with viva voce evidence.
45Niro further suggests that the focus of the application is to determine whether the club’s rules and Constitution, together with the rules of natural justice, were followed in the disciplinary process engaged against him by the club. That can be determined, says Niro, by a judge hearing the application and relying on the affidavit evidence presented.
46The dispute centers around the sufficiency and fairness of the disciplinary process engaged against Niro by the club, and not around any conduct on January 12, 2014, which might have triggered the process.
The Issue
47Must the dispute between Niro and the club proceed by way of action, or can it proceed by way of application.
The Rules
[48] 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.
14.02 Every proceeding in the court shall be by action, except where a statute or these rules provide otherwise.
14.05(1) The originating process for the commencement of an application is a notice of application….
14.05(3) A proceeding may be brought by application where these rules authorize the commencement of a proceeding by application or where the relief claimed is, (h) in respect of any matter where it is unlikely that there will be any material facts in dispute.
Analysis
49I was provided with only one case on the issue of whether the proceeding should be by way of action rather than application, and that case pre-dates the “culture-shifting” decision of Hryniak v. Mauldin, 2014 SCC 7.
50That decision signalled a different approach to the process of resolution of civil disputes. The opening words of the decision reflect this:
Ensuring access to justice is the greatest challenge to the rule of law in Canada today. Trials have become increasingly expensive and protracted. Most Canadians cannot afford to sue when they are wronged or defend themselves when they are sued, and cannot afford to go to trial.
51The case signalled the shift away from the conventional trial in favour of proportional procedures tailored to the needs of a particular case. Ibid at para. 2.
52Although neither side referred to the Hryniak decision in their material or their submissions, I nonetheless am of the view that the principles outlined above are applicable in this case.
53Whether or not a matter should proceed by action, as opposed to application, in accordance with Rule 14.05(3) is informed by Hryniak and the assessment of whether or not “the forensic machinery of a trial” is required for a fair and just process, one that allows the judge to find the facts necessary to resolve the dispute and apply the relevant legal principles to the facts as found. See Blackberry Ltd. v. Marineau-Mes, 2014 ONSC 1790.
54The crux of the application is the manner in which the disciplinary process was conducted, rather than a re-litigation of the alleged events which gave rise to the disciplinary process.
55The inquiry engaged as a result of the application is of a similar character as a judicial review of a decision of an administrative tribunal.
56Although there may be facts in dispute, it is premature to conclude that only a trial and its benefits will provide for a full appreciation of the evidence. The materials filed can be supplemented with transcripts of cross-examination of the deponents of the affidavits filed, which would then allow for a fair and just process of fact finding and application of relevant legal principles.
57I decline, at this stage of the proceeding, to make the order sought; it would be premature to do so, in my view, and it would not represent the most expeditious and least costly means of resolving the dispute. It is also not required to justly and fairly dispose of the issues in the litigation.
58The motion is dismissed
59If the parties are unable to agree on costs of the motion, they are to communicate with the trial co-ordinator within 20 days to fix a date and time to argue costs, failing which they will be taken to have agreed on costs.
The Honourable Madam Justice Louise L. Gauthier
Released: December 21, 2015
COURT FILE NO.: A-12891-15
DATE: 2015-12-21
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Peter Niro
Applicant
– and –
Societa Caruso
Respondent
RULING ON MOTION
Gauthier J.
Released: December 21, 2015