SUPERIOR COURT OF JUSTICE - ONTARIO

COURT FILE NO.: 10-CV-416780
MOTION HEARD: September 23, 2015

BETWEEN: Quang Phong Dang, Jonathan Dang, Thi Thai
Nguyen and Van Le Nguyen

Plaintiffs

v.

Omar Conteh

Defendant

BEFORE: Master Thomas Hawkins

APPEARANCES:
Mark Stoiko for moving and responding plaintiff
Quang Phong Dang
F (416) 640-2216

Paul Omeziri for moving and responding defendant
F (416) 593-7760

Paul Druxerman for moving and responding plaintiffs
Jonathan Dang, Thi Thai Nguyen, and Van Le Nguyen
F (416) 241-4691

REASONS FOR DECISION

Nature of Motion

[1] I have two motions before me. The motion I will deal with first is a motion by the defendant in part under subrule 24.01(1) for an order dismissing this action for delay with costs to the moving defendant and in part for failure of the plaintiffs to comply with a timetable order made by Master Haberman on April 10, 2014.

[2] The second motion before me is a motion by the plaintiff Quang Phong Dang (“Q.P. Dang”) for an order varying the timetable order of Master Haberman dated April 10, 2014.

Background Facts

[3] This action arises out of a motor vehicle accident which occurred on December 20, 2008. At that time a motor vehicle operated by the defendant Conteh struck from behind a motor vehicle operated by the plaintiff Q.P. Dang. The other three plaintiffs were passengers in the Dang motor vehicle.

[4] The statement of claim in this action was issued on December 17, 2010 and served on the defendant Conteh shortly thereafter. On May 24, 2011 Conteh served a statement of defence which included a counterclaim against the plaintiff Q.P. Dang. Q.P. Dang did not serve his statement of defence to counterclaim until May 6, 2013.

Comments on Evidence Before Me

[5] The defendant’s motion to dismiss this action for delay is supported by an affidavit sworn by Sebastian Schmoranz, one of the defendant’s lawyers. The motion by the plaintiff Q.P. Dang is supported by an affidavit of Yen Cao, a law clerk in the office of the lawyers for Q.P. Dang. Mr. Schmoranz swore two further affidavits on this motion, chiefly in response to the affidavit of Yen Cao. There is no affidavit from any of the parties to this action. There has been no cross-examination of either of the two affiants.

[6] The law firms representing the plaintiff Q.P. Dang and the defendant both delivered facta and briefs of authorities. The law firm for the three passenger plaintiffs did not deliver any material in response to or in support of these two motions. That said, I recognize that the affidavit of Yen Cao deals in part with the period of time when the law firm where she works represented all four plaintiffs. During argument counsel for the three passenger plaintiffs simply relied upon the submissions of counsel for Q.P. Dang.

[7] There is no formal motion by the three passenger plaintiffs to vary the timetable order of Master Haberman.

Motion to Dismiss the Action for Delay

[8] As I have said, the defendant moves in part under subrule 24.01(1) for an order dismissing this action with costs for delay. Subrule 24.01(1) provides as follows.

A defendant who is not in default under these rules or an order of the court may move to have an action dismissed for delay where the plaintiff has failed,

(a) to serve the statement of claim on all the defendants within the prescribed time;

(b) to have noted in default any defendant who has failed to deliver a statement of defence, within thirty days after the default;

(c) to set the action down for trial within six months after the close of pleadings; or

(d) [Revoked R.R.O. 1990, Reg. 194, r.24.01(2).]

(e) to move for leave to restore to a trial list an action that has been struck off the trial list, within thirty days after the action was struck off.

[9] Here the moving defendant relies on subrule 24.01(1)(c) and submits that this action should be dismissed for delay because the plaintiffs failed to set this action down for trial within six months after the close of pleadings. Pleadings closed at the latest on May 6, 2013 when the defendant by counterclaim Q.P. Dang delivered his statement of defence to the defendant’s counterclaim. The defendant by counterclaim Q.P. Dang did not deliver any reply to defence to counterclaim.

[10] The six month period after the close of pleadings expired on November 6, 2013. However before that six month period expired, the registrar administratively dismissed this action for delay on September 17, 2013 on the basis of rule 48.14 as it read before 2015.

[11] On April 10, 2014 Master Haberman set aside the registrar’s dismissal order of September 17, 2013 and expressly reinstated this action. Implicit in Master Haberman’s order reinstating this action as of April 10, 2014 is the fact that the defendant could not move after April 10, 2014 for an order dismissing this action for delay for the failure of the plaintiffs to set this action down for trial within six months after the close of pleadings, that is by November 6, 2013.

[12] I am reinforced in this view by the fact that in the same order, Master Haberman both approved a litigation timetable for this action which required that the plaintiffs set this action down for trial by May 31, 2015, and ordered that if this action were not set down for trial by that date the action was to be dismissed with costs.

[13] I therefore decline to dismiss this action for delay for failure of the plaintiffs to comply with subrule 24.01(1)(c).

[14] This second basis on which the defendant Conteh moves to dismiss this action for delay is the failure of the plaintiffs to comply with the timetable which Master Haberman set for this action on April 10, 2014.

[15] Two provisions of the Rules of Civil Procedure are relevant to this part of the defendant’s motion. The first is subrule 3.04(4) which deals with non-compliance with a timetable. This subrule provides as follows.

If a party fails to comply with a timetable, a judge or case management master may, on any other party’s motion,

(a) stay the party’s proceeding;

(b) dismiss the party’s proceeding or strike out the party’s defence; or

(c) make such other order as is just.

[16] The second provision is rule 60.12 which deals with failure to comply with an interlocutory order. Master Haberman’s order of April 10, 2014 is an interlocutory order. Rule 60.12 provides as follows.

Where a party fails to comply with an interlocutory order, the court may in addition to any other sanction provided by these rules,

(a) stay the party’s proceeding;

(b) dismiss the party’s proceeding or strike out the party’s defence; or

(c) make such other order as is just.

[17] In her affidavit Yen Cao gives several explanations for the delays in the progress of this action.

[18] Arrangements were made to conduct examinations for discovery of all parties in March of 2012. Plaintiffs’ counsel examined the defendant for discovery on March 12, 2012. However, the examinations for discovery of the plaintiffs had to be postponed because of the need for the insurer of Q.P. Dang to appoint a lawyer to defend the counterclaim. This did not happen until May 6, 2013 when the defence lawyer for Q.P. Dang delivered a statement of defence to counterclaim.

[19] No attempt was made to examine the plaintiffs for discovery in the months after May 2013.

[20] As I have said, on September 17, 2013 the registrar dismissed this action for delay. The plaintiffs brought a motion to set aside the registrar’s dismissal order which motion Master Haberman heard on April 10, 2014.

[21] At the hearing Master Haberman raised an issue which had the unintended effect of causing considerable further delay. (I respectfully agree that Master Haberman was correct in raising that issue.) Master Haberman felt that the law firm representing all four plaintiffs had a conflict because the interests of the three passenger plaintiffs were not fully compatible with the interests of the plaintiff driver Q.P. Dang. He was also a defendant by counterclaim. The defendant blamed Q.P. Dang for the subject accident. The law firm representing all four plaintiffs could not properly advise three of their clients as to whether or not they should make a claim against their fourth client.

[22] The law firm for the plaintiffs initially advised them to seek independent legal advice. All four plaintiffs later signed waivers for the conflict, but not at the same time. More recently, the three passenger plaintiffs changed their minds and decided to retain a new law firm. This new law firm served a notice of change of lawyer on January 28, 2015, over nine months after Master Haberman reinstated and timetabled this action.

[23] Master Haberman’s timetable order set down deadlines for the completion of examinations for discovery of all parties, fulfillment of discovery undertakings, motions arising from discoveries, mediation, and for the plaintiffs to set this action down for trial.

[24] The plaintiffs met the deadline for their examination for discovery of the defendant. The defendant did not meet the deadline for his examination for discovery of the plaintiffs. They have not yet been examined. The defendant has an explanation for this, which I have summarized below in paragraph [29].

[25] I do not know if the defendant gave any undertakings when he was examined for discovery on March 12, 2012, or if the plaintiffs intended to bring any motion arising out of his examination for discovery. Certainly no such motion was ever brought.

[26] There is no evidence that either side attempted to set up a mediation.

[27] The plaintiffs never set this action down for trial.

Explanation for Failure to Comply with Timetable Order

[28] On her affidavit Yen Cao says that the clerk in her firm who was responsible for entering the deadlines in Master Haberman’s timetable order in the firm’s tickler system failed to do so through inadvertence. As a result, she says, the plaintiffs did not meet most of the deadlines in Master Haberman’s order. That is not the whole story.

[29] I have already mentioned how the need to resolve the conflict of interest between the plaintiff driver Q.P. Dang on the one hand and the three plaintiff passengers on the other hand had the practical consequence of delaying prosecution of this action. This conflict was not resolved until January 28, 2015 when the new law firm for the three passenger plaintiffs filed a notice of change of lawyer. By then the deadline for conducting examinations for discovery had passed. I do not see how the plaintiffs could be examined for discovery until the conflict of interest amongst the plaintiffs was resolved. That was something over which the defendant had no control.

[30] I have also mentioned the fact that the need for the issurer of Q.P. Dang to appoint a lawyer to defend the counterclaim against him delayed the examinations for discovery of the plaintiffs. Since this representation issue was resolved by May 6, 2013, before Master Haberman made her timetable order, it was not a reason for failure to comply with her order.

[31] In June 2014, Yen Cao wrote defence counsel advising that Q.P. Dang was bringing a motion for leave to amend the statement of claim. Ultimately this motion as never argued. The motion did however delay the examinations for discovery of the plaintiffs. I am sure that defence counsel did not want to examine the plaintiffs for discovery until pleadings were settled.

[32] Defence counsel sent counsel for Q.P. Dang several emails trying to set up examinations for discovery and reminding opposing counsel that the parties were subject to a timetable. These emails did not have the desired effect. The plaintiffs were not examined for discovery and the discovery deadline in Master Haberman’s order was not met. The defendant’s motion to dismiss this action for delay then followed.

[33] I must now decide what sanction, if any, I should impose for failure to comply with Master Haberman’s timetable order.

[34] While no party is completely blameless when it comes to complying with Master Haberman’s order, most but not all of the blame lies with the plaintiffs.

[35] Master Haberman’s order expressly provided that if the action were not set down for trial by May 31, 2015, the action was to be dismissed with costs. That order also provided that the set down deadline could be varied by court order. The plaintiff Q.P. Dang has brought a motion for an order varying that timetable. I therefore feel that I have a discretion as to what sanction to apply for failure to comply with that order.

[36] 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 and 26 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.]

[37] It is clear form H.B. Fuller that the court’s preference is to allow civil actions to be decided on their merits. However, I must balance the interests of the parties. That involves considering whether the defendant will be prejudiced if this action is allowed to proceed to trial.

Prejudice to Defendant

[38] The following is the only prejudice raised by the defendant. In his affidavit sworn May 12, 2015 Mr. Schmoranz states in part that his firm has not received any OHIP records for the plaintiff Van Le Nguyen, one of the plaintiff passengers. Mr. Schmoranz also points out that the Ministry of Health and Long-Term Care keeps OHIP personal claims information for seven years only.

[39] In his statement of defence the defendant alleges in part that the plaintiffs had a history of pre-existing injury, illness and disease. The defendant further alleges that some or all of the complaints alleged in the statement of claim relate to these pre-existing injuries, illnesses and diseases.

[40] The material before me includes a letter from a law clerk in the law firm that represented all four plaintiffs dated January 17, 2012 to the Ministry of Health and Long-Term Care requesting OHIP records for the plaintiff Van Le Nguyen from 2005 forward. There are other similar more recent letters requesting OHIP records for Van Le Nguyen for more recent periods. I do not know what OHIP records were received.

[41] The law firm that now represents Van Le Nguyen has not filed any material challenging the claim that the defendant has been prejudiced by an incomplete pre-accident OHIP record for Van Le Nguyen.

[42] The evidentiary record on the subject of the pre-accident history of injury, illness and disease for Van Le Nguyen is so incomplete that I am unable to determine how serious is the prejudice which the defendant claims to have suffered. It may be serious. It may be trifling. It may be non-existent. I just do not know.

Outcome of Motions

[43] For all these reasons I have decided that I should dismiss the defendant’s motion to dismiss this action for delay, and grant the motion of the plaintiff Q.P. Dang to amend the timetable order of Master Haberman as asked, subject to the following term. The defendant may raise at trial the issue that he has been prejudiced by incomplete pre-accident OHIP records for the plaintiff Van Le Nguyen. The trier of fact will be in a much better position than I am to measure that prejudice and to grant a suitable remedy.

[44] The plaintiffs must realize that this is a last chance order, and that absent highly unusual circumstances, a further defence motion to dismiss this action for delay will likely succeed.

Costs of Motions

[45] In disposing of these motions in the way that I have, I consider that I have granted 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.).

[46] An order will therefore issue that the plaintiffs jointly and severally pay the defendant the costs of these motions fixed at $3,750 within 30 days.

_(original signed) ______

Date: December 30, 2015
Master Thomas Hawkins_