ONTARIO

SUPERIOR COURT OF JUSTICE

COURT FILE NO.: CV-11-442446

COURT FILE NO.: CV-13-472027

DATE: 20151215

BETWEEN:

LOREN HOFFMAN
Plaintiff

– and –

AVIS BUDGET GROUP, INC. also known as AVIS WORLD HEADQUARTERS, AVISCAR INC., AVIS RENT A CAR, INC. also known as AVIS RENT A CAR also known as AVIS RENT-A-CAR, AVIS RENT A CAR SYSTEM, INC.

Defendants

William G. Scott, for the Plaintiff

Brigette A. Morrison, for Aviscar Inc.

HEARD: November 2, 2015

– and –

BETWEEN:

LOREN HOFFMAN
Plaintiff

– and –

CONTINENTAL CASUALTY COMPANY

Defendants

William G. Scott, for the Plaintiff

Brigette A. Morrison, for Continental Casualty Company

HEARD: November 2, 2015

ENDORSEMENT

HOOD j.

nature of Motion

[1] There are two motions for summary judgment before me. In both, the respective moving party defendants ask that the claims by the plaintiff, Loren Hoffman, be dismissed with costs on the basis that both actions are an abuse of process. I am not prepared to dismiss either claim for the following reasons.

Facts

[2] On June 10, 2002 the plaintiff, Loren Hoffman (Hoffman), was operating an automobile rented from and owned by Aviscar Inc. (Aviscar) in Brampton, Ontario. He was hit by an automobile owned and operated by Martin Jekel (Jekel). Jekel was uninsured.

[3] On May 16, 2005 Hoffman commenced an action against Jekel and his own insurer, Atlantic Mutual, as the insurer providing uninsured motorist coverage (the 2005 action).

[4] Atlantic Mutual took the position that the insurer of Aviscar should be the priority insurer providing uninsured motorist coverage to Hoffman. Hoffman’s counsel agreed and in May, 2006, agreed to a dismissal of the claim as against Atlantic Mutual.

[5] As explained in the affidavit of Barry Munro, one of the lawyers for Hoffman, thereafter the counsel for Hoffman, engaged in a lengthy process of trying to identify Aviscar’s insurer, the correct name of the insurer, and the legal entity carrying on business of that insurer. They did so by starting a number of actions against the parties who they believed were the insurer of Aviscar. They based these actions upon information they received from a variety of insurers and from their own searches. They also started a number of actions against Avis, in a variety of forms, as the holder of a valid insurance policy.

[6] Briefly, the plaintiff brought the following lawsuits:

(i) Hoffman v. ING Insurance Company of Canada (“ING”) CV-06-310978

This was commenced on May 8, 2006, against ING as the insurer of Avis and discontinued on November 10, 2006, when ING advised that it was not the insurer of Avis.

(ii) Hoffman v. Continental Insurance Management Ltd. CV-06-313922

This was commenced on June 26, 2006, against the defendant as the insurer of Avis and dismissed on October 30, 2006, on consent without costs.

(iii) Hoffman v. Pilot Insurance Company CV-06-322035

This was commenced on November 10, 2006, against the defendant as the insurer of Avis and discontinued on March 14, 2008.

(iv) Hoffman v. Avis Budget Group, Inc. CV-07-331866

This was commenced on April 26, 2007, against Avis Budget Group, Inc. as the owner of the car rented by Hoffman and as the holder of an insurance policy providing uninsured motorist coverage.

This action was defended. Avis Budget Group, Inc. admitted it had an insurance policy, pleaded that it had a limit of $200,000 and raised a variety of other defences.

This action went through the steps of production, discovery and various interlocutory motions before being dismissed on consent on a without costs basis on October 23, 2009.

(v) Hoffman v. CNA Insurance Company CV-08-363654

This was commenced on October 3, 2008, against the defendant as the insurer of Avis. The defendant admitted it had an insurance policy for the vehicle but defended on a number of grounds including that the claim was statute-barred, that Hoffmann contributed to the accident and did not suffer the damages alleged. This action was dismissed for delay by the registrar on April 11, 2011.

[7] On February 28, 2011, Hoffman obtained a judgment against Jekel in the 2005 action on an undefended basis from Justice D.A. Wilson. His judgment was for damages in the amount of $394,654.35, legal costs of $78,680.80, and travel costs of $4,734.78 for having to attend the trial, for a total of $478,069.93.

[8] Hoffman continued with his actions in the hopes of collecting on uninsured motorist coverage from someone. The next lawsuits were as follows:

(vi) Hoffman v. Avis Budget Group, Inc. CV-11-430692

This was commenced on July 14, 2011, based upon the default judgment. However, it was never served and was dismissed as abandoned on March 7, 2012.

(vii) Hoffman v. Avis Budget Group, Inc. and other Avis defendants including Aviscar CV-11-442446

This is one of the matters now before me. This was commenced on December 20, 2011, based upon the default judgment. On July 24, 2012, the defendants delivered a defence. It raised a whole series of defences. It acknowledged that Continental Casualty Company was the insurer of Aviscar. The action was discontinued against all of the defendants except Aviscar on March 22, 2013.

(viii) Hoffman v. Continental Casualty Company et al CV-13-472027

This is the other matter now before me. This was commenced on January 16, 2013. On October 25, 2013, the claim was discontinued against one of the defendants, and on January 24, 2014, the claim was amended to limit the claim against Continental Casualty Company as the insurer of Aviscar, seeking damages of $200,000, being the uninsured motorist coverage limits. A defence was served March 12, 2014. It somewhat mirrors the defence in the Aviscar action and asks that this action be tried with, or immediately after, the Aviscar action.

[9] The defendants, Aviscar and Continental Casualty Company, in their respective actions now seek orders dismissing the claims against them as being an abuse of process.

Analysis

[10] In Behn v. Moulton Contracting Ltd, 2013 SCC 26, at para. 40, LeBel J. for the Court cited Goudge J.A. in Canam Enterprises Inc. v. Coles (2000), 2000 8514 (ON CA), 51 O.R. (3d) 481 (C.A.), (who wrote in dissent but whose reasons were subsequently approved by the Supreme Court in 2002 SCC 63), stating that the doctrine of abuse of process

“engages the inherent power of the court to prevent the misuse of its procedure, in a way that would be manifestly unfair to a party to the litigation before it or would in some other way bring the administration of justice into disrepute. It is a flexible doctrine unencumbered by the specific requirements of concepts such as issue estoppel. See House of Spring Gardens Ltd. v. Waite, [1990] 3 W.L.R. 347 [C.A.], at p. 358.

One circumstance in which abuse of process has been applied is where the litigation before the court is found to be in essence an attempt to re-litigate a claim which the court has already determined. See Solomon v. Smith, supra. It is on that basis that Nordheimer J. found that this third party claim ought to be terminated as an abuse or process.” [Emphasis in original.]

[11] While there were previous actions against ING, Continental Insurance Management Ltd., and Pilot Insurance Company, these companies have no connection with Continental Casualty Company. Mr. Lax, the lawyer for Continental Casualty Company, acknowledged this on his cross-examination and in his answers to undertakings. The only previous defendant with any connection to Continental Casualty Company is CNA Insurance Canada which Continental Casualty Company underwrites. In the 2008 action, CNA Insurance Company was named as the insurer of Avis. However, that claim was issued prior to the judgment obtained by Hoffman against Jekel in the 2005 action. As well, it was never determined by a court. That claim against CNA was dismissed by the registrar for delay.

[12] There is no evidence put forward by Continental Casualty Company as to why having to defend this claim is manifestly unfair, as adopted by the Court in Behn, or that it was somehow involved in the CNA defence.

[13] As pointed out by Lauwers J.A. in Abarca v. Vargas, 2015 ONCA 4, at para. 29 “instances of abuse of process fall across the spectrum from egregiously contemptuous conduct to relatively minor breaches of procedural rules”. Where the abuse lies on the spectrum determines the remedy. Here the defendant seeks to have the claim dismissed. That remedy is inappropriate to the alleged abuse. Moreover, I am not prepared to find that there was any abuse in starting the claim against Continental Casualty Company. There is a lack of connection to the previous defendants, other than the minimal connection to CNA, and there is a lack of evidence of any prejudice.

[14] As well, the CNA claim was commenced prior to the judgment against Jekel and arguably was either statute-barred, or alternatively, premature, and it was only after the judgment was obtained could the claim be made against Continental Casualty Company for uninsured motorist coverage, see: Schmitz v. Lombard General, 2014 ONCA 88 at para. 20; Chahine v. Grybas, 2014 ONSC 4698 at paras. 33 – 37 and Platero v. Pollock, 2015 ONSC 2922 at para. 35.

[15] I make no finding in that regard, as to whether the CNA claim was statute-barred. It is not necessary for me to do so in order to find that the action against Continental Casualty Company is not an abuse of process. As acknowledged by counsel for Hoffman, Continental Casualty Company is entitled in the within action to raise any and all defences, and to re-litigate any issue with respect to liability and damages that could have been raised in the 2005 action.

[16] With respect to the claim against Aviscar, there is no previous action against it. There was an action against Avis Budget Group, Inc. which was dismissed without costs on October 23, 2009, following production and discovery. There is no suggestion that Aviscar and Avis Budget Group, Inc. are one and the same so that the present claim is an attempt to re-litigate a claim which the court has already determined.

[17] The claim made against Aviscar is that Aviscar held a policy of insurance on the rented vehicle driven by Hoffman which provided uninsured coverage for damages caused by the negligence of uninsured, underinsured or unidentified drivers.

[18] Hoffman pleads that his cause of action arose on February 28, 2011, when he obtained judgment for $478,096.93 against Jekel in the 2005 action. He then pleads that on May 6, 2011 a demand letter was sent to Aviscar demanding payment of the judgment amount pursuant to Aviscar’s obligations under its policy of insurance and on May 12, 2011 Aviscar denied payment.

[19] Aviscar denies receiving the demand letter or sending a denial of payment. Aviscar raises a host of other defences including that the claim as against it along with the 2005 action are statute-barred.

[20] I cannot find on the material before me that the current claim against Aviscar is an abuse of process, certainly not because of one prior claim against another Avis entity or the claims against potential insurers of Avis.

[21] Aviscar in argument seemed to move away from seeking a dismissal on the basis of an abuse of process due to the prior actions against the Avis companies and various insurers to seeking a dismissal on the basis that the claim does not disclose a reasonable cause of action. That is not really the motion that was before me. However, Hoffman, in any event, does raise a cause of action. He alleges that Aviscar self-insures their rental vehicles up to a certain amount and may in fact be liable for some of the damages claimed. This is referred to at paragraph 24 of Mr. Munro’s responding affidavit and the July 15, 2015 letter from Mr. Scott in answer to Mr. Munro’s undertakings.

[22] When Mr. Lax, who swore the affidavit in support of Aviscar’s motion, was cross-examined, he was asked at question 7 whether Aviscar self-insured, as the plaintiff wanted to know who provided insurance coverage for uninsured and unidentified drivers. Aviscar refused to answer on the basis that the question was not relevant to the issues on the motion. If the issue being argued before me was solely whether there was an abuse of process due to previous claims, as the motion was framed, then Aviscar arguably was correct. However, Aviscar could not refuse to answer this question and then argue that the claim against it did not disclose a reasonable cause of action when this was the very allegation being made by the plaintiff.

[23] My dismissal of Aviscar’s motion is without prejudice to Aviscar bringing another summary judgment motion or perhaps a motion under Rule 21.01 if so advised. However, under the latter, Aviscar has to be mindful of the evidentiary restrictions under Rule 21.10. As I have some familiarity with the background, I am prepared to hear such a motion if the parties desire, but I am not seized of the action going forward as it is still, as I understand it, at the pleadings stage.

[24] As to costs, I would hope that the parties would be able to agree on costs. If they cannot, the plaintiff shall provide a costs outline and no more than three pages of submissions. Due to the time of year, these submissions are to be provided on or before January 7, 2016. The cost submissions from Aviscar and from Continental Casualty Company shall be provided within three weeks from the date of the plaintiff’s submissions.

Hood J.

Date: December 15, 2015