SUPERIOR COURT OF JUSTICE - ONTARIO

COURT FILE NO.: 10-CV-417357
MOTION HEARD: June 10 and September 16, 2015

BETWEEN:

Andrea Prescott, Amanda Burt and

Barbara Ramsey

Plaintiffs

v.

Ramon Barbon and Eduardo Ramon-Sagastume

Defendants

BEFORE: Master Thomas Hawkins

APPEARANCES: William G. Scott for moving plaintiffs

F (416) 869-0271

Trevor J. Buckley for responding defendant

Ramon Barbon

F (416) 596-0952

Derek M. Fulton for responding defendant

Eduardo Ramon-Sagastume

F (416) 225-7112

Donna Polgar for responding intervenor Economical

Mutual Insurance Company

F (416) 593-5922

REASONS FOR DECISION

Nature of Motion

[1] In this action for damages arising out of a motor vehicle accident, the plaintiffs move for an order setting aside the order of the registrar dated August 25, 2011 dismissing this action as abandoned with costs.

[2] This motion is opposed by both defendants and by the intervenor Economical Mutual Insurance Company (“Economical”). Economical provides uninsured motorist coverage to all three plaintiffs and underinsured motorist coverage to the plaintiff Amanda Burt. Economical is not a defendant.

[3] The plaintiff brings this motion pursuant to subrules 37.14(1)(c) and (2). These subrules provide as follows.

37.14 (1) A party or other person who,

(a) is affected by an order obtained on motion without notice;

(b) fails to appear on a motion through accident, mistake or insufficient notice; or

(c) is affected by an order of a registrar,

may move to set aside or vary the order, by a notice of motion that is served forthwith after the order comes to the person’s attention and names the first available hearing date that is at least three days after service of the notice of motion.

(2) On a motion under subrule (1), the court may set aside or vary the order on such terms as are just.

[4] The plaintiffs are parties affected by an order of a registrar.

The Subject Motor Vehicle Accident

[5] I have mentioned that this action arises out of a motor vehicle accident. The accident occurred on December 28, 2008 in Toronto. At that time the plaintiffs Andrea Prescott (“Prescott”) and Barbara Ramsey (“Ramsey”) were passengers in an automobile owned and operated by the plaintiff Amanda Burt (“Burt”). According to the police report, the Burt vehicle was stopped at an intersection. A second motor vehicle owned and operated by the defendant Ramon Barbon (“Barbon”) was stopped behind the Burt motor vehicle. A third motor vehicle operated by the defendant Eduardo Ramon-Sagastume (“Ramon-Sagastume”) and owned by his father Juan Ramon then struck the Barbon motor vehicle in the rear with such force that the Barbon motor vehicle was driven forward into the rear of the Burt motor vehicle resulting in alleged injuries to the three plaintiffs.

[6] At the time of the accident Ramon-Sagastume was operating his father Juan Ramon’s motor vehicle without his father’s consent. Juan Ramon is not a defendant. Ramon-Sagastume had been consuming beverage alcohol. He was charged with and pleaded guilty to impaired driving contrary to section 253 of the Criminal Code of Canada, R.S.C. 1985 Chap. C46.

[7] Because Ramon-Sagastume was operating a motor vehicle at the time of the subject accident without the consent of its owner Juan Ramon, the liability insurer of that motor vehicle has denied coverage to Ramon-Sagastume.

[8] The following is a history of this action with an emphasis on the events leading up to the registrar’s dismissal order of August 25, 2011 and to argument of this motion before me on June 10 and September 16, 2015. I shall refer to the plaintiffs’ main lawyer as lawyer D.C. Wawanesa Mutual Insurance Company (“Wawanesa”) insured both Barbon’s and Juan Ramon’s motor vehicles.

DATE

EVENT

December 28, 2008

Plaintiffs injured in motor vehicle accident involving Barbon and Ramon-Sagastume.

December 29, 2010

Through an agent lawyer D.C. has Toronto registry of this court issue the statement of claim in this action.

January 11, 2011

Both Barbon and Ramon-Sagastume are served with the statement of claim.

January 17, 2011

Wawanesa writes lawyer D.C. on behalf of Barbon acknowledging receipt of statement of claim and requesting a waiver of defence. Lawyer D.C. speaks to a Wawanesa adjuster and grants Barbon a waiver of defence. The adjuster assures lawyer D.C. that Barbon’s statement of defence will be filed in sufficient time to avoid an administrative dismissal of the action.

April 21, 2011

Lawyer Derek Abreu writes lawyer D.C. advising that Wawanesa has retained his firm to represent Juan Ramon. Wawanesa has advised lawyer Abreu that lawyer D.C. intends to amend the statement of claim to add Juan Ramon as a defendant. Lawyer Abreu advises lawyer D.C. that there is a limitation period issue with respect to adding Juan Ramon as a defendant and that at the time of the subject accident, Ramon-Sagastume was operating Juan Ramon’s motor vehicle without his consent.

May 6, 2011

Lawyer D.C. writes Toronto Police Service and requests a complete copy of their report on subject motor vehicle accident.

July 11, 2011

Court registrar sends out Notice that Action will be Dismissed as Abandoned (Form 48E).

July 22, 2011

Lawyer D.C. receives the Form 48E notice and believes that he has a further 45 days to act before the registrar will dismiss this action.

August 25, 2011

Court registrar issues order dismissing this action as abandoned because no defence has been filed. This is only 34 days after lawyer D.C. received the Form 48E notice.

August 30, 2011

Unaware of the dismissal order, lawyer D.C. writes lawyer Abreu advising that in order to prevent a dismissal order, he is having the defendants noted in default. The same day he instructs an agent to do just that.

September 1, 2011

Agent advises lawyer D.C. that this action had been administratively dismissed on August 25, 2011.

November 6, 2012

Lawyer D.C. writes lawyer Abreu advising that on a recent file review it came to his attention that this action had been administratively dismissed and that his firm had no intention of abandoning this action. This letter may not have been mailed. Lawyer Abreu never received it.

August 13, 2013

Lawyer D.C. writes lawyer Abreu and Wawanesa a lengthy letter and requests their consent to an order setting aside the registrar’s dismissal order.

September 3, 2013

Lawyer Abreu writes lawyer D.C. advising that he cannot provide him with the position of Barbon until he receives the plaintiffs’ motion materials.

December 16, 2013

Lawyer D.C. reports this matter to his insurers who retain Mr. Scott’s firm to bring this motion.

February 20-23, 2014

Counsel for lawyer D.C. serves notice of motion to set aside administrative dismissal order on defendants, Wawanesa and Economical.

2014-2015

Materials supporting and opposing present motion prepared, served and filed, and cross-examinations conducted.

June 10 and September 16, 2015

Motion argued before me. I reserve judgment.

Legal Test for Setting Aside Registrar’s Order Dismissing Action as Abandoned

[9] In Scaini v. Prochnicki, 2007 ONCA 63, 85 O.R. (3d) 179, Goudge J.A., speaking for the Court of Appeal for Ontario, allowed an appeal from a motion judge. The motion judge had dismissed a plaintiff’s motion to set aside a registrar’s dismissal order because the plaintiff had failed to satisfy one of four criteria often used in deciding such motions. Master Dash originally laid down these four criteria in Reid v. Dow Corning Corp. (2001), 11 C.P.C. (5th) 80.

[10] At paragraphs 21 to 24 of his decision, Goudge J.A. expressed himself as follows.

21 More importantly, I do not agree that the case law reviewed in Reid, supra, yields the proposition that an appellant must satisfy each relevant criterion in order to have the registrar’s order set aside. None of the cases referred to say so expressly and several proceed on a more contextual basis. For example, in Steele v. Ottawa-Carleton (Regional Municipality), [1998] O.J. No. 3154 (Gen. Div.). Master Beaudoin, at para. 17, described the guiding principle in deciding whether to set aside a Rule 48.14 dismissal by the registrar as follows:

… Ultimately, the Court will exercise its discretion upon a consideration of the relevant factors and will attempt to balance the interests of the parties.

22 I agree with Master Beaudoin.

23 In my view, a contextual approach to this question is to be preferred to a rigid test requiring an appellant to satisfy each one of a fixed set of criteria. The latter approach is not mandated by the jurisprudence. On the other hand, the applicable rules clearly point to the former. In particular, the motion to set aside the registrar’s order dismissing the action for delay engages rule 37.14(1) (c) and (2). The latter invites the court to make the order that is just in the circumstances. A fixed formula like that applied by the motion judge is simply too inflexible to allow the court in each case to reach the just result contemplated by the rules.

24 That is not to say that there are no criteria to guide the court. Indeed I view the criteria used by the motion judge as likely to be of central importance in most cases. While there may be other relevant factors in any particular case, these will be the main ones. The key point is that the court consider and weigh all relevant factors to determine the order that is just in the circumstances of the particular case.

[11] In the recent decision of the Court of Appeal for Ontario in H.B. Fuller Company v. Rogers (Rogers Law Office), 2015 ONCA 173, Weiler J.A., who delivered the judgment of the court, wrote the following at paragraphs 25 to 27 of her decision.

[25] The factors that guide the court’s choice between ending the plaintiff’s action before trial and forcing the opposite party to defend the case despite the delay require a judge to resolve the tension between two underlying policies. The first is that civil actions should be decided on their merits. The second is that civil actions should be resolved in a timely and efficient manner in order to maintain public confidence in the administration of justice: Kara, at para. 9; Hamilton (City), at paras. 20-21; Marché, at para. 25.

[26] When reviewing a registrar’s dismissal for delay under the former rule 48.14, the weight of authority from this court has leaned towards the first policy consideration. As Laskin J.A. stated in Hamilton (City), at para. 20, quoting with approval the motion judge’s comment, “[T]he court’s bias is in favour of deciding matters on their merits rather than terminating rights on procedural grounds.” While failure to enforce the rules may undermine public confidence in the capacity of the justice system to process disputes fairly and efficiently, as Sharpe J.A. observed in 119, at para. 19, nonetheless:

[P]rocedural rules are the servants of justice not its master … 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. [T]he Rules and procedural orders are construed in a way that advances the interests of justice, and ordinarily permits the parties to get to the real merits of their dispute. [119, at para. 19. Citations omitted.]

[27] The court’s preference for deciding matters on their merits is all the more pronounced where delay results from an error committed by counsel. As the court stated in Habib, at para. 7, “[O]n a motion to set aside a dismissal order, the court should be concerned primarily with the rights of the litigants, not with the conduct of their counsel.” In Marché, Sharpe J.A. stated, at para. 28, “The law will not ordinarily allow an innocent client to suffer the irrevocable loss of the right to proceed by reason of the inadvertence of his or her solicitor” (citations omitted).

Contextual Approach to this Motion

[12] With effect as of January 1, 2015 (that is, while this motion was pending and before it was argued) rule 48.14 was amended and rule 48.15 was repealed altogether.

[13] Before 2015 court registrars could dismiss actions in two relevant situations.

[14] First, under subrule 48.15(1) the registrar was directed to dismiss actions as abandoned if (amongst other things) no statement of defence was filed within 180 days after the action was commenced.

[15] Before 2015 subrule 48.15(1) provided as follows.

48.15(1) The registrar shall make an order dismissing an action as abandoned if the following conditions are satisfied, unless the court orders otherwise:

1. More than 180 days have passed since the date the originating process was issued.

2. None of the following has been filed:

i. A statement of defence.

ii. A notice of intent to defend.

iii. A notice of motion in response to an action, other than a motion challenging the court’s jurisdiction.

3. The action has not been disposed of by final order or judgment.

4. The action has not been set down for trial.

5. The registrar has given 45 days notice in Form 48E that the action will be dismissed as abandoned.

[16] Secondly, before 2015 the registrar was directed to dismiss a defended action for delay under subrule 48.14(1) two years and 90 days after the first defence was filed. The term “defence” is defined broadly in subrule 48.14(0.1).

[17] Before 2015, subrules 48.14(0.1) and (1) provided as follows.

48.14 (0.1) In this rule, “defence” means,

(a) a statement of defence,

(b) a notice of intent to defend, and

(c) a notice of motion in response to an action, other than a motion challenging the court’s jurisdiction.

(1) Unless the court orders otherwise, if an action in which a defence has been filed has not been placed on a trial list or terminated by any means within two years after the first defence is filed, the registrar shall serve on the parties a status notice in Form 48C.1 that the action will be dismissed for delay unless, within 90 days after service of the notice, the action is set down for trial or terminated, or documents are filed in accordance with subrule (10).

[18] As I have said, with effect as of January 1, 2015 rule 48.15 was repealed altogether. Registrars no longer have jurisdiction to dismiss actions as abandoned. Had this repeal of subrule 48.15(1) been made retroactive to 2011, the registrar would not have dismissed this action as abandoned. However this repeal of subrule 48.15(1) was not made retroactive to 2011. Nevertheless this repeal was in force on September 16, 2015 when argument of this motion concluded.

[19] In practical terms the amendment to subrule 48.14(1) means that plaintiffs currently have at least five years to set their actions down for trial or otherwise conclude their actions. That is more than twice as much time as plaintiffs had before 2015. What now constitutes an acceptable level of diligence in the prosecution of an action is a much easier test to meet than was the case in the past.

[20] The relevant parts of subrule 48.14(1) now provide as follows.

Unless the court orders otherwise, the registrar shall dismiss an action for delay in either of the following circumstances, subject to subrules (4) to (8):

1. The action has not been set down for trial or terminated by any means by the later of the fifth anniversary of the commencement of the action and January 1, 2017.

[21] In Klaczkowski v. Blackmont Capital Inc., 2015 ONSC 1650, Janet Wilson J., sitting as a single judge of the Divisional Court, said (at paragraph 33) that the January 1, 2015 changes to rule 48.14 may be considered as part of the context in which a motion to set aside a registrar’s order dismissing an action for delay is argued.

[22] In my view, the repeal of rule 48.15 may similarly be considered as part of the context in which this motion to set aside a registrar’s order dismissing an action as abandoned was argued.

[23] The following is another aspect of the context in which this motion was argued. The decisions of the Court of Appeal for Ontario in both Scaini and J.B. Fuller which I have referred to involved registrars’ orders dismissing an action for delay. The motion before me involves a registrar’s order dismissing an action as abandoned. This happened because neither defendant took the simple step of serving and filing a notice of intent to defend. Had either defendant taken that step by June 29, 2011 (180 days after the statement of claim was issued) the registrar would not have dismissed this action as abandoned. Neither defendant did so. That being so, both defendants must accept part of the blame for the fact that this action has been administratively dismissed.

[24] As between Barbon and Ramon-Sagastume, I regard Barbon as significantly more blameworthy. I say this because, through Wawanesa, Barbon requested a waiver of defence. Lawyer D.C. granted Barbon this indulgence because the Wawanesa adjuster assured him that Barbon’s defence would be delivered in sufficient time to prevent an administrative dismissal. This never happened.

[25] By contrast, Ramon-Sagastume never sought and then abused an indulgence.

[26] Because Goudge J.A. said in Scaini (quoted above in paragraph [9]) that the four Reid criteria were likely to be of central importance in most motions to set aside a registrar’s administrative dismissal order, I will consider these four criteria, using a contextual approach while attempting to balance the interests of the parties.

First Reid Criterion

[27] The first Reid criterion is as follows.

Have the plaintiffs provided a satisfactory explanation for the litigation delay?

[28] This explanation must cover all delays in the prosecution of this action from its inception on December 29, 2010 forward.

[29] This action was properly prosecuted until mid-January, 2011. By that time lawyer D.C. had the statement of claim served on both defendants and had given the defendant Barbon a waiver of defence on terms that Barbon’s statement of defence be filed in time to prevent the registrar from dismissing this action as abandoned. Lawyer D.C. did not give the defendant Ramon-Sagastume a waiver of defence.

[30] In terms of formal steps, this action has not been prosecuted towards trial or final disposition since mid-January 2011 with one exception. In late 2013 and more recently the plaintiffs’ law firm wrote letters to obtain and did obtain various documents supporting the plaintiffs’ claims for damages. These documents include clinical notes and records of treating physicians, decoded OHIP summaries, income tax returns and accident benefit claims files.

[31] Lawyer D.C. has the following explanation for the delays in the prosecution of this action. During the period up to July 2011, lawyer D.C. had an overwhelming case load. He found it hard to juggle everything. There were times when he had no administrative support whatsoever.

[32] In the summer of 2011 his firm hired three more lawyers and some of his files were distributed to these lawyers. This did not help. Lawyer D.C. still did next to nothing to move this action forward.

[33] Lawyer D.C. never had a specific law clerk or administrative assistant assigned to him. There was staff turnover. Lawyer D.C. had a tickler system in place but he did not run that system himself. That was the responsibility of support staff. On at least two occasions this action fell out of his tickler system altogether with the result that nothing was done on the file for this action for months and months on end.

[34] Lawyer D.C. is adamant that neither he nor the plaintiffs ever made a conscious decision to abandon this action. Between January 2011 and March 2015 lawyer D.C. met with one or more of the plaintiffs on several occasions. In addition, lawyer D.C. had telephone conversations with the plaintiffs. He is unable to recall when and how often he had these telephone conversations.

[35] There have been significant delays in the prosecution of this action. I do not find lawyer D.C.’s explanation for the delays to be satisfactory. However it is clear that neither lawyer D.C. nor the plaintiffs ever made a deliberate and conscious decision to abandon this action. While there have been significant delays (the action is almost five years old and is still at the pleadings stage), owing to the amendments to rule 48.14, I do not find this delay to be inordinate. If this action is allowed to proceed the registrar will not dismiss this action for delay before January 1, 2017 at the earliest.

[36] Finally, as discussed in paragraphs [23] and [24] above, I am of the view that the defendants must accept part of the blame for the fact that the registrar has dismissed this action as abandoned.

[37] In these circumstances, while I am of the view that the plaintiffs have failed to meet the first Reid criterion, I am not prepared to dismiss this motion on that ground alone.

Second Reid Criterion

[38] I now turn to the second Reid criterion. It is necessary to edit this criterion because when Master Dash originally laid down these four criteria in Reid v. Dow Corning Corp., supra, he was dealing with a motion to set aside a registrar’s order dismissing an action for delay. This is a motion to set aside a registrar’s order dismissing an action as abandoned.

[39] As edited so as to apply to the kind of motion before me, the second Reid criterion may be expressed as follows.

Have the plaintiffs led satisfactory evidence to explain that they always intended to prosecute this action within the time limits set out in the Rules of Civil Procedure or a court order but failed to do so through inadvertence.

[40] In my view, the main purpose of this criterion is to identify those situations in which a plaintiff or a plaintiff’s counsel, with the approval of his or her client, has deliberately flouted the Rules of Civil Procedure or orders of the court.

[41] Some of the cases describe this conduct as contumacious or stubbornly disobedient behaviour. I do not regard lawyer D.C. as a stubbornly disobedient person. The evidence before me does not support such a finding. The plaintiffs are not in default of any court order. It is true that this action has not been prosecuted in accordance with the time frame contemplated by the Rules of Civil Procedure. This happened because of the circumstances I have set out in paragraphs [31] to [35] above, not because anyone was engaged in stubbornly disobedient behaviour.

[42] Lawyer D.C. is clear in his evidence that neither he nor the plaintiffs ever intended to abandon this action.

[43] On July 22, 2011 lawyer D.C. received the Form 48E Notice that Action will be Dismissed. He believed, correctly, that he had 45 days from the date he received the Form 48E notice to take the necessary action. This is clear from the pre-2015 wording of subrule 48.15(1) and of Form 48E itself.

[44] Lawyer D.C. believed that all he had to do to prevent the registrar from dismissing this action as abandoned was to have the registrar note the defendants in default of defence. This is not correct.

[45] To prevent the registrar from dismissing this action as abandoned, lawyer D.C. would had to do one of the following.

(a) note the defendants in default of defence and bring a motion under subrule 19.05(1) before a judge for judgment against the defendants on the statement of claim; or

(b) set the action down for trial.

[46] The better course of action would have been to bring a motion for judgment on the statement of claim after having the registrar note the defendants in default of defence. Because it would have been most unlikely that the plaintiff could secure a motion date before a judge and obtain judgment against the defendants by a date less than 180 days after this action was commenced, the motion for judgment would have to be combined with a motion for an order directing the registrar not to dismiss this action as abandoned before the disposition of the plaintiff’s motion for judgment against the defendants.

[47] Another approach for lawyer D.C. to take would have been to bring a motion for an order extending the 180 day deadline in subrule 48.15(1) by a few months and, in the meantime, pressure Wawanesa to retain counsel for Barbon and enter a defence.

[48] Lawyer D.C. instructed an agent to have the registrar note the defendants in default of defence no later than September 1, 2011. His agent was unable to do so because the registrar had administratively dismissed this action on August 25, 2011.

[49] That was only 34 days after lawyer D.C. received the Form 48E notice. That being so, the registrar did not give the plaintiffs 45 days advance notice before making an administrative dismissal order on August 25, 2011. This does not render the order a nullity. However it does make the order an irregularity. That is a factor in favour of setting the order aside.

[50] For the following reasons I decline to dismiss this motion because the plaintiffs have not met the second Reid criterion. That criterion does not fit the unusual facts underlying this motion. Lawyer D.C. did not engage in stubbornly disobedient behaviour. He did not ignore the Form 48E notice. He began to take the correct first step in responding to that notice (having the defendants noted in default) but appears not to have realized that having the defendants noted in default was only a first step. He would have to obtain judgment against the defendants or set the action down for trial to prevent the registrar from dismissing the action as abandoned. Lawyer D.C. was prevented from taking even this first step because the registrar had failed to give the plaintiffs the 45 days notice they were entitled to under the pre-2015 wording of subrule 48.15(1). As I have said, the registrar’s dismissal order is therefore an irregularity.

[51] Subrule 2.01(1) makes it clear that the preferred course of action for the court to take is to set aside an irregular order. Subrule 2.01(1) provides as follows.

A failure to comply with these rules is an irregularity and does not render a proceeding or a step, document or order in a proceeding a nullity, and the court,

(a) may grant all necessary amendments or other relief, on such terms as are just, to secure the just determination of the real matters in dispute; or

(b) only where and as necessary in the interest of justice, may set aside the proceeding or a step, document or order in the proceeding in whole or in part.

[52] Setting aside an irregular order is particularly appropriate where the source of the irregularity is not the conduct of one or more of the parties to an action or of their counsel, but rather is the conduct of the court registrar.

Third Reid Criterion

[53] This brings me to the third Reid criterion. This criterion may be expressed as follows.

Has the present motion been brought promptly?

[54] Mr. Scott concedes that this motion was not brought promptly. The plaintiffs’ law firm is responsible for much of the delay in bringing this motion but not all of it. In early September 2011 lawyer D.C. became aware of the registrar’s dismissal order of August 25, 2011. Much of the initial delay was due to the fact that on two occasions, this action fell out of lawyer D.C.’s tickler system administered by support staff. On August 13, 2013 lawyer D.C. wrote both Wawanesa and Barbon’s lawyer requesting their consent to an order setting aside the registrar’s dismissal order. Lawyer Abreu responded on September 3, 2013 advising that he could not provide lawyer D.C. with Barbon’s position until he received the plaintiffs’ motion materials.

[55] On December 16, 2013 lawyer D.C. reported this matter to his insurers who retained repair counsel. In late February 2014 Mr. Scott had a notice of motion to set aside the registrar’s dismissal order served on both defendants, Wawanesa and Economical. From that point on the motion moved forward in an acceptable manner having regard to the number of parties involved and the fact that the motion had to be argued as a long motion. There is a substantial waiting time for hearing dates for long motions before a master.

[56] In Finlay v. Van Paassen, 2010 ONCA 204 Laskin J.A., speaking for the Court of Appeal for Ontario, said the following (at paragraph 33).

In my view, on a motion to set aside a dismissal order, the court should be concerned primarily with the rights of the litigants and not with the conduct of their counsel.

[57] At paragraph 28 of the same decision, Laskin J.A. said that the issue of prejudice

“invariably is a key consideration on a motion to set aside a dismissal order”.

Fourth Reid Criterion

[58] This leads to the fourth Reid criterion. This criterion (edited so as to apply to the facts before me) may be expressed as follows.

Has either of the defendants suffered any significant prejudice in presenting his case at trial as a result of the plaintiffs’ delay or as a result of steps taken following the dismissal of this action?

[59] The plaintiffs have the onus of persuading me that both the defendants have not suffered such prejudice. That said, in most motions like the present one, as between the plaintiffs and the defendants, the defendants have the better means of knowledge as to whether either of them has suffered prejudice.

[60] I shall deal first with the subject of prejudice to Barbon.

[61] First, Barbon submits that he has been prejudiced because this action is statute-barred. He should not be required to defend a statute-barred action.

[62] The motor vehicle accident giving rise to this action occurred on December 28, 2008. Under section four of the Limitations Act, 2002, S.O. 2002 c.24 sch.B the basic limitation period expires on the second anniversary of the day on which the claim was discovered. Here that second anniversary was December 28, 2010. In this case the statement of claim was not issued until December 29, 2010, the day after the second anniversary of the subject accident with the result, Barbon submits, that this action is statute-barred.

[63] This is not correct. In December 2010 Christmas Day fell on a Saturday and Boxing Day fell on a Sunday. Under rule 1.03 both Christmas Day and Boxing Day are holidays. Rule 1.03 further provides that when Christmas Day and Boxing Day fall on a Saturday and Sunday the following Monday and Tuesday are holidays. The plaintiffs’ lawyers could not have the registrar issue the statement of claim on December 28, 2010 because that was a holiday and the courts were closed.

[64] Section 28 clause (i) of the Interpretation Act, R.S.O. 1990 c I.11 is relevant. This clause provides as follows.

28. In every Act, unless the contrary intention appears,

(i) where the time limited for a proceeding or for the doing of anything in a court office, a land registry office or a sheriff’s office expires or falls on a day that is prescribed as a holiday for that office, the time so limited extends to and the thing may be done on the day next following that is not a holiday;

[65] But for this provision of the Interpretation Act, the limitation period for commencing this action would have expired at the end of Tuesday December 28, 2010. However, under rule 1.03 of the Rules of Civil Procedure, December 28, 2010 was a holiday with the result that all court offices were closed, including the court office where the plaintiffs’ lawyers wanted to have the statement of claim in this action issued. That being so, under section 28 clause (i) of the Interpretation Act the time for issuing the statement of claim in this action was extended to Wednesday December 29, 2010. That day was not a holiday and the court offices were open.

[66] The plaintiffs’ lawyers did have the statement of claim issued on Wednesday, December 29, 2010. Therefore this action is not statute-barred.

[67] Barbon therefore has not suffered prejudice in the form of having to defend a statute-barred action.

[68] Next Barbon complains that owing to the delays of the plaintiffs and their lawyers, locating witnesses to the accident to comment upon the issue of liability will be more difficult and may be impossible. Even if witnesses are located, Barbon says that their memories will have eroded with the passage of time. Barbon (and Ramon-Sagastume for that matter) has not identified any witness helpful to the defence who has died or disappeared and cannot be located despite reasonable efforts to do so.

[69] Barbon was served with the statement of claim on January 11, 2011 less than 25 months after the accident. He was thus in a position to notify his insurer Wawanesa and defend this action. Wawanesa was in a position years ago to conduct surveillance of the plaintiffs, locate and interview witnesses, take witness statements, retain counsel to defend this action, examine the plaintiffs for discovery and request independent medical examinations.

[70] Barbon did not defend this action. His insurer Wawanesa was aware of this action in early 2011 and initially retained lawyer Abreu to defend Juan Ramon as the owner of the vehicle driven by Ramon-Sagastume. Juan Ramon never became a defendant to this action. More recently, Wawanesa retained lawyer Abreu to respond to the present motion on behalf of Barbon.

[71] Neither Barbon nor Wawanesa took the defensive measurers I have described in paragraph [69] above. One cannot manufacture prejudice by failing to take prudent defensive measures.

[72] In his affidavit responding to this motion lawyer Abreu expresses concerns about prejudice owing to the likelihood that documents on the plaintiffs’ injuries and the losses which they claim have not been produced and may no longer exist. Lawyer Abreu’s affidavit sworn on October 8, 2014.

[73] After that affidavit was sworn, Mr. Scott had three supplementary motion records delivered. Two of these motion records each contain an affidavit of Dianne Howe, a legal assistant in Mr. Scott’s firm, describing in considerable detail the documents which have been collected respecting the plaintiffs’ injuries, the treatment they received, income tax returns, OHIP summaries from early 2007 forward and the property damage file on the Burt motor vehicle. There are clinical notes and records from physicians treating each of the plaintiffs.

[74] Neither the defendants nor Economical cross-examined Ms. Howe and asked her to produce the documents she refers to or delivered any affidavit in response to either of her affidavits. Apart from the fact that they apparently would have preferred to see OHIP summaries on the plaintiffs that cover a longer pre-accident period, they do not point to any particular document that is missing. Since there are clinical notes and records from the physicians who treated each of the plaintiffs, this form of prejudice is on the evidence before me, too speculative to form a basis for dismissing this motion.

[75] The delays that have occurred have not prejudiced either of the defendants on the issue of liability for the subject motor vehicle accident. The objective facts as to how that accident occurred are known. A police officer investigated the accident and completed a report. It is clear that Ramon-Sagastume is at fault. The only issue on liability is whether Barbon is partly to blame for the accident. He is available to testify in his own defence. He does not claim that he has forgotten how the accident happened.

[76] Counsel for Barbon submitted that in the factum for the plaintiffs Mr. Scott says in part that Ramon-Sagastume “is fully at fault” for the subject motor vehicle accident. That being so, counsel for Barbon submits that the registrar’s dismissal order should be set aside as regards Barbon but not as regards Ramon-Sagastume.

[77] Counsel for Barbon has misread this statement from the plaintiffs’ factum. I do not understand that statement to mean that Ramon-Sagastume is solely at fault for the subject motor vehicle accident. It is abundantly clear from both Mr. Scott’s factum and his oral submissions that Mr. Scott wants the registrar’s dismissal order set aside as regards both defendants so that the plaintiffs can prosecute this action to judgment against or settlement with both defendants.

[78] I next turn to the subject of prejudice to Ramon-Sagastume if this action is allowed to proceed.

[79] In my view the predicament in which Ramon-Sagastume finds himself is to a great extent one of his own making.

[80] First and foremost, Ramon-Sagastume drove his father’s motor vehicle without his father’s consent. As a result of this Wasanesa has denied him coverage under his father’s insurance policy. Neither the plaintiffs nor lawyer D.C. had anything to do with this lack of insurance coverage.

[81] Next Ramon-Sagastume drove his father’s motor vehicle and rear-ended the Barbon vehicle while impaired by his consumption of alcohol. Again, neither the plaintiffs nor lawyer D.C. had anything to do with this.

[82] Thirdly, Ramon-Sagastume decided not to defend this action. Neither the plaintiffs nor lawyer D.C. played any role in that decision. If this motion is successful Ramon-Sagastume will be free to defend this action going forward. He is free to plead that the plaintiffs’ injuries are so minor that they do not clear the statutory threshold in the Insurance Act, R.S.O. 1990 c.I8 with the result that all or nearly all of their claims should be dismissed.

[83] Fourthly, Ramon-Sagastume says that he has been prejudiced because two files containing documents on the subject motor vehicle accident have gone missing.

[84] The first missing file is that of Ronald Wine, the lawyer who defended Ramon-Sagastume on the impaired driving charge laid against him. Lawyer Wine and his file on this charge cannot now be located. Ramon-Sagastume does not say when lawyer Wine and his file went missing. If this happened before there was any delay in the prosecution of this action that is not a form of prejudice that would justify dismissing this motion. I note that this action was not commenced until two years after the date of the accident but before the limitation period expired.

[85] The other file that has gone missing was maintained by Ramon-Sagastume’s former girlfriend. She is now his wife. He says that after he received the registrar’s dismissal order of August 25, 2011 he and his then girlfriend ignored the file and did not keep track of its whereabouts. He does not say how soon after August 25, 2011 the file went missing.

[86] Ramon-Sagastume also says in his affidavit opposing this motion that after he received the registrar’s dismissal order of August 25, 2011

“My family and I were relieved as we were now free to plan our future without the uncertainty of litigation.”

[87] That is an assumption in which neither the plaintiffs nor lawyer D.C. played any part. The order itself warns anyone reading it that the order “may be set aside under rule 37.14.”

[88] The files which have gone missing appear to have had documents which Ramon-Sagastume feels would be helpful to him on the issue of whether the impact between the Barbon motor vehicle and the Burt motor vehicle was severe enough to cause the injuries which the plaintiffs have alleged they suffered.

[89] Be that as it may, there is other evidence available on the severity of that impact. The property damage file on the Burt motor vehicle is still available. The police report confirms that all three vehicles were driven from the accident location and that the three plaintiffs each sought their own medical attention. No one was taken away by ambulance. Juan Ramon is available to testify that the damage to his vehicle was so minor that he never had it repaired. Ramon-Sagastume himself can testify that the two impacts were minor.

[90] Similarly, the documents which Ms. Howe has collected include clinical notes and records of physicians who treated each of the plaintiffs as well as OHIP decoded treatment summaries for each of them covering the time of the accident and afterwards.

[91] Because of the availability of this other evidence, I do not feel that the fact that some documents on the severity of these two impacts have gone missing has caused prejudice to the defendants of such magnitude that I should dismiss this motion.

[92] Ramon-Sagastume also says in his affidavit that he has lost contact with a few friends who “would have information relevant to the night of December 28, 2008.” He does not say that they witnessed the accident. He does not say that they have information helpful to his defence. The disappearance of an unhelpful witness is not prejudice.

[93] The last form of prejudice of which Ramon-Sagastume complains, concerns a home which he and his wife purchased in November 2013 with the assistance of a lawyer. They took title to the home in both their names. He says that had this action been active at that time they would have taken title in his wife’s name only.

[94] In my view, Ramon-Sagastume took a chance which he did not have to take by assuming title to this home in part in his own name and has only himself to blame, if that ultimately has adverse consequences for him. Even though he appears to be at least partly liable for the subject accident, he may succeed with a defence that the plaintiffs’ injuries are not severe enough to clear the statutory threshold under the Insurance Act, R.S.O. 1990 c.I.8.

[95] There is no evidence that he disclosed to his real estate lawyer the facts that he was an uninsured defendant in an action for substantial damages which he had not defended. There is no evidence that he sought advice from this real estate lawyer (or any lawyer, for that matter) as to (a) how to protect that home from the plaintiffs’ claims or (b) what was the likelihood that the registrar’s dismissal order could be set aside.

[96] Neither the plaintiffs nor lawyer D.C. played any role in this non-disclosure and failure to seek legal advice.

Conclusion

[97] For all these reasons I have come to the conclusion that the registrar’s dismissal order of August 25, 2011 should be set aside. So ordered.

[98] I direct the parties to agree upon a timetable that will see this action set down for trial within the next year. If the parties are unable to agree upon such a timetable within the next 30 days, any counsel and Ramon-Sagastume may write me requesting a case conference at which time I will set a timetable in consultation with counsel and Ramon-Sagastume.

Costs

[99] In disposing of this motion in the way that I have, I consider that I have given the plaintiffs an indulgence. The price of an indulgence is the payment of costs to those who have sought unsuccessfully to prevent its being granted. See Fox v. Bourget (1987), 17 C.P.C. (2d) 94 (Ont. Dist. Ct.).

[100] An order will therefore issue that within 90 days the plaintiffs are to pay the costs of this motion fixed as follows:

to Barbon the sum of $2,500

to Ramon-Sagastume the sum of $3,000; and

to Economical the sum of $3,000.

__(Original signed)

Date: December 11, 2015 Master Thomas Hawkins