Court File and Parties

COURT FILE NO.: 10-21802 DATE: 2015-12-30 SUPERIOR COURT OF JUSTICE - ONTARIO

RE: ANTHONY D’ONOFRIO, JAMES D’ONOFRIO, and ANNA D’ONOFRIO, Plaintiffs AND: ADVANTAGE CAR AND TRUCK RENTALS LIMITED, ANITA MARQUES and UNIFUND INSURANCE COMPANY, Defendants

BEFORE: The Hon. Mr. Justice Robert B. Reid

COUNSEL: S. Singh, Counsel, for the Plaintiffs M. McLean, Counsel, for the Defendants Advantage and Marques A. Khan, Counsel, for the Defendant Unifund

HEARD: December 2, 2015

ENDORSEMENT

[1] The plaintiffs seek an order precluding the defendants Advantage and Marques from raising the issue of the identity of the driver and/or the owner of the defendant motor vehicle and the issue of consent of the driver on the basis of issue estoppel.

[2] Alternatively, the plaintiffs seek to set aside the summary judgment of Arrell J. dated August 13, 2015 in which the plaintiff’s claim against Unifund was dismissed.

[3] For the reasons set out below, and except as to an amendment of the order of Justice Arrell on consent as to a clerical matter, the motion is dismissed.

Background of the claim:

[4] A collision occurred on August 13, 2008 in which the vehicle operated by the plaintiff Anthony D’Onofrio was rear-ended by another vehicle.

[5] The driver of the other vehicle fled the scene of the collision after a brief conversation with Mr. D’Onofrio. However, Mr. D’Onofrio recorded the license plate number which was traced by the police to the defendant Advantage.

[6] The plaintiffs added the defendant Unifund, the insurer of the plaintiff’s vehicle, as a precaution pursuant to unidentified or uninsured motorist coverage.

[7] Advantage defended the case and does not admit the ownership or the involvement of its vehicle in the collision.

[8] As result of investigations done by Unifund, Ms. Marques was identified as the driver of the Advantage vehicle. She was an employee of Advantage at the time. In the pleadings, however, Marques has denied involvement in the collision.

Summary judgment motion:

[9] Unifund brought a motion for summary judgment seeking an order that the action be dismissed against it on the basis that the identities of the owner and driver of the vehicle involved in the collision with Mr. D’Onofrio were known and that there is no issue of consent of the owner. Counsel for the plaintiffs and for the other defendants took no position on the motion. The order was granted.

Position of the parties on this motion:

[10] Despite the evidence, the remaining defendants continue to assert defences regarding identity of the owner and driver of the defendant motor vehicle.

[11] The plaintiffs wish to avoid the possibility of a successful defence at trial on the basis of identity or consent.

[12] The plaintiffs argue that the summary judgment finally determines the issue of identity and gives rise to issue estoppel. They submit that since Advantage and Marques put forward no evidence in response to the summary judgment motion, they are bound by the effect of the summary judgment. The facts in support of that motion were to the effect that the remaining defendants were identified as the owner and driver of the defendant motor vehicle.

[13] Alternatively, the plaintiffs seek to set aside the summary judgment to bring Unifund back into the action.

[14] The defendants Advantage and Marques submit that issue estoppel does not apply as a consequence of the summary judgment. They argue that any contractual claim between Mr. D’Onofrio and Unifund is independent from the issue of liability as between them and the plaintiffs in the tort action. They took no position on the summary judgment motion because they were not privy to the contractual relationship between the Mr. D’Onofrio and Unifund. They submit that they are entitled to make full answer and defence to the tort claim without restriction.

[15] Unifund takes no position as to the estoppel issue but does submit that there is no legal basis to set aside the summary judgment.

Analysis:

(a) Setting Aside the Summary Judgment:

[16] The provisions of Rule 37.14 of the Rules of Civil Procedure R.R.O. 1990, Reg. 194 define the circumstances when an order may be set aside. Here, there was ample notice to the defendants and no party failed to appear by accident or mistake. The motion was not brought within the specified time frame.

[17] Rule 59.06 allows the amendment of an order arising from an accidental slip or clerical order. I am satisfied that there was a clerical error: the preamble to the summary judgment indicates that the defendants Advantage and Marques consented to it, whereas in fact they took no position. There will be an order amending the order of Justice Arrell pursuant to the provisions of rule 59.06(1) of the Rules to show that the defendants Advantage and Marques took no position.

[18] I am not satisfied that the granting of the order itself, or the failure on the part of the other defendants or the plaintiffs to respond amounted to an accidental slip.

[19] There has not been any change in material facts that would warrant a re-litigating of the matter of Unifund’s involvement in the action.

[20] The plaintiffs were not able to identify any other authority under the Rules or at common law that would allow this court to make an order setting the summary judgment aside.

[21] As a result, that alternative ground for relief fails.

(b) Issue Estoppel:

[22] The main argument of the plaintiffs is the application of issue estoppel.

[23] The public policy behind issue estoppel is the prevention of relitigation. As such, the principles of judicial economy, consistency and finality are supported.

[24] The legal bases for establishing issue estoppel are well defined, and all three must be present:

a. the issue must be the same one decided in the prior decision;

b. the prior decision must have been final; and

c. the parties to both proceedings, or their privies, must be the same.

[25] Although the case law suggests that a consent order should be given the same deference as an order made after a hearing on the merits, I consider this to be a different situation. Here, there was a conscious choice on the part of the responding parties not to become involved. As a result, there was no need for a determination on the merits but also no indication of agreement.

[26] The plaintiffs appeared to have taken no position because they believed that the facts were determinative of identity concerning the defendant vehicle’s owner and driver. Neither of the remaining defendants misled the plaintiffs as to their position that the issue was still alive.

[27] Advantage and Marques had no interest in whether Unifund stayed in the action and perhaps preferred the claim to proceed with one fewer party in order to simplify matters and reduce costs.

[28] The affidavit material filed in support of the summary judgment motion was to the effect that the defendants Advantage and Marques were identified as the owner and driver of the defendant vehicle in the collision. The dismissal of the claim against Unifund was requested on the basis that the action did not involve an uninsured motorist claim.

[29] I accept that the order made by Justice Arrell is deemed to be founded on the allegations made by Unifund with the conclusion that there was no genuine issue requiring a trial as to identity of the tort defendants. It is not accurate to say that there necessarily was any legal analysis because obviously the matter was not determined on its merits nor were there any representations by the other parties. However, this issue was the same as that which exists between the plaintiffs and the remaining defendants.

[30] There is no dispute that the order of Justice Arrell was final upon the expiry of the relevant appeal period.

[31] As to the third branch of the test for issue estoppel, I am not satisfied that the tort defendants were parties to the proceeding in the sense contemplated by the case law. They did not actively participate. They were not contractually connected with Unifund. They had no right or interest in keeping Unifund in the action. In effect, since the tort defendants were disinterested in the outcome of the summary judgment motion and did not participate in it, they cannot be deemed to be parties for the purpose of the issue estoppel submission.

[32] I find for support for this position in the decision of reasons of Justice Laskin writing for the Ontario Court of Appeal in Minott v. O’Shanter (1999) 1999 CanLII 3686 (ON CA), 42 O.R. (3d) 321 where at paragraph 39, he writes as follows:

To apply issue estoppel, the parties to the first proceeding must be the same as the parties to the second proceeding. Deciding whether this requirement has been met causes difficulty when one of the parties to the second proceeding is entitled to participate actively in the first proceeding and to exercise fully the rights of a party in that proceeding, but chooses not to do so. That is the case here. Although O’Shanter could have taken part in the oral hearing before the Board of Referees, it declined to do so. In such cases, whether a person is a party for the purpose of issue estoppel depends on its degree of participation. Because O‘Shanter did not actively participate in the hearing before the Board of Referees, I conclude that it was not a party for the purpose of issue estoppel.

[33] In addition, I have considered that the imposition of issue estoppel is a matter of judicial discretion. This is not a case that engages the principles of judicial economy, consistency and finality such that, even if I had found that the three preconditions for issue estoppel had been established I would have granted the order requested by the plaintiffs. The tort claim as between the plaintiffs and the defendants is continuing. The issues can be determined on the merits as between them. I am satisfied that the public policy in allowing the claim as between the plaintiffs and the tort defendants to be resolved on its merits in order to do justice between those parties is not offset by the effect of the summary judgment motion in which neither of those parties participated.

[34] Therefore, the plaintiff’s motion for an order precluding the defendants Advantage and Marques from raising the issue of the identity of the driver and/or the owner of the defendant motor vehicle and the issue of the driver operating the vehicle with the owner’s consent on the basis of issue estoppel is dismissed. As noted above, there will be an order amending the order of Justice Arrell pursuant to the provisions of Rule 59.06(1) of the Rules of Civil Procedure to the effect that the defendants Advantage and Marques took no position.

Costs:

[35] I encourage the parties to discuss the resolution of the costs issue and reach an agreement accordingly. In the event that no agreement can be reached, costs submissions may be made in writing, according to the following schedule:

a. The defendants are to serve and file written costs submissions and a bill of costs on or before January 22, 2016.

b. The plaintiffs are to serve and file written costs submissions and a bill of costs on or before February 5, 2016.

c. The defendants are to serve and file any responding submissions on or before February 19, 2016.

[36] If no submissions are received by February 19, 2016, I will assume that costs have been resolved.

Reid J.

Date: December 30, 2015