CITATION: Talsky v. Waxman, 2016 ONSC 1953
COURT FILE NO.: 6715/14
DATE: 2016-03-18
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
ALINA TALSKY
Plaintiff
– and –
RANDALL COREY WAXMAN
Defendant
Lee Guarino, for the Plaintiff
Sara Mosadeq, for the Defendant
HEARD: March 15, 2016
REASONS FOR JUDGMENT
Gray J.
[1] In this action, the plaintiff sues on a promissory note. The defendant now brings a motion for summary judgment, claiming that the action is statute barred.
[2] For the reasons that follow, the motion for summary judgment is dismissed.
Background
[3] The plaintiff and the defendant were good friends for many years. I assume, as a result of this litigation, that that is no longer the case.
[4] The defendant had another long-time friend, Steven Israel, who owned a business called Worldwide Trading Partners Inc., an importer of recycling bins. Worldwide had a lucrative contract with Walmart.
[5] The defendant had invested considerable sums in Worldwide, by loaning money to his friend Israel. Eventually, the plaintiff became involved in advancing funds that ultimately became invested in Worldwide.
[6] There is a dispute as to how the plaintiff became involved, and whether she was actually investing the funds in Worldwide, or whether she was simply lending the money to the defendant, who subsequently gave the money to Israel. For the purposes of the motion before me, I need not resolve this factual issue.
[7] It would appear that the plaintiff had advanced approximately $175,000 to the defendant. After some repayment, the amount of $138,000 remained outstanding. On August 8, 2012, the plaintiff and the defendant executed a promissory note, under which the defendant promised to pay the plaintiff $138,000, plus interest, on demand. It is that promissory note on which this action is based.
[8] Coincidentally, the defendant and Mr. Israel executed a similar promissory note, under which Mr. Israel promised to pay $138,000 to the defendant. The plaintiff says she was unaware of that note. It has no particular relevance to the issue before me.
[9] It appeared that Worldwide suffered a period of financial difficulty and went out of business.
[10] On October 12, 2012, the defendant paid the sum of $83,000 to the plaintiff as a partial payment on account of the promissory note. That much is not disputed. The parties differ on what other communications transpired between them. Some of the differences are critical as they relate to a determination of when the relevant limitation period commenced to run, and when it expired.
[11] This action was commenced on December 29, 2014. Thus, if the limitation period commenced to run prior to December 29, 2012, this action is statute barred. If it commenced to run after December 29, 2012, it is not.
[12] The promissory note is payable on demand. Accordingly, the limitation period started to run on the date a “demand” was made. The main dispute is as to when a demand was made in this case.
[13] The defendant says that the plaintiff immediately began making demands under the promissory note. He says he received telephone calls on a weekly basis from the plaintiff demanding repayment. He does not say that any demand was made in writing. He says that prior to October 12, 2012, the date that the sum of $83,000 was paid, the plaintiff called the defendant approximately two to three times per week making clear and unequivocal demands. After October 12, 2012, the demands abated for a period, then resumed. The defendant’s friend Israel says he overhead one conversation between the plaintiff and the defendant, while the defendant’s telephone was audible, during which the plaintiff made a very clear demand for payment.
[14] The plaintiff denies that she made any demands for payment prior to December, 2014. She says that in 2012 she simply communicated to the defendant her concern that she might not be repaid, and made “inquiries” of him as to when he would be in a position to pay her.
[15] In October, 2014, text messages were exchanged between the plaintiff and the defendant. They had to do with when the defendant might receive his bonus, and presumably when he might be in a position to pay some of the outstanding money that was owing.
[16] In December, 2014, further text messages were exchanged between the parties. One of them, on December 23, 2014, would clearly constitute a demand for payment.
Submissions
[17] Counsel for the defendant, the moving party, submits that I should find, on a balance of probabilities, that demands for payment were made prior to December 29, 2012, and accordingly the limitation period prescribed by section 4 of the Limitations Act, 2000, expired prior to the issuance of the Statement of Claim. Pursuant to section 5 (3) of the Act, the day on which the claim is deemed to have been “discovered” for the purpose of section 4 is the date on which a demand for payment was made.
[18] Counsel for the defendant acknowledges that there is a dispute as to whether a demand for payment was made in 2012, but submits that, on a balance of probabilities, I should conclude that at least one demand was made.
[19] Counsel submits that I should have regard for all of the surrounding circumstances. She submits that it would have been unlikely that the defendant would have made a payment of $83,000 on October 12, 2012 unless the plaintiff had demanded that payment be made. She points out that the defendant had to mortgage his home in order to come up with the money, and it is unlikely the defendant would have done so unless he felt compelled to make the payment.
[20] Counsel for the defendant submits that I should view the plaintiff’s evidence with some suspicion. She points out that the plaintiff acknowledges that she raised the subject of payment with the defendant, but says she only made “inquiries” as to when payment might be made. She submits that it is unlikely that simple inquiries would have led to a payment of $83,000, and the mortgaging of the defendant’s home in order to do so.
[21] Counsel for the defendant also points out that the defendant’s evidence as to demands being made is corroborated by the evidence of Mr. Israel.
[22] Counsel submits that this is an appropriate case under which I should exercise the powers conferred on the court under rule 20.04(2.1), and weigh the evidence and evaluate credibility. She submits that even on the basis of a paper record, it is clear that, at least on a balance of probabilities, the defendant’s evidence should be preferred. It is more likely than not that demands for payment were made in 2012.
[23] Counsel submits, in the alternative, that if I cannot make the appropriate determination based on a paper record, this would be a proper case to exercise the powers under rule 20.04(2.2), and conduct a mini-trial, and hear oral evidence.
[24] Counsel for the plaintiff submits that the motion for summary judgment should be dismissed, and the matter should be ordered to proceed to trial.
[25] Counsel submits that even if it were to be determined that a demand for payment was made in 2012, thus commencing the running of the limitation period, the limitation period was extended in October, 2014 by exchanges of text messages that occurred on October 3, 4, 6, and 7, 2014. He submits that pursuant to section 13(1), (9) and (10) of the Act, the limitation period is extended where an acknowledgement of liability is made before the limitation period has expired, and the acknowledgment is in writing and signed. He submits that the text messages in October, 2014 are written acknowledgements of liability, and they are considered to have been signed by virtue of the Electronic Commerce Act, 2000.
[26] Counsel submits that there are simply too many disputed issues of fact, and too many issues of credibility, to safely permit the disposition of this action on the basis of a paper record.
[27] Counsel submits that this is not an appropriate case for the court to conduct a mini-trial. To do so would not save appreciable time, and could simply result in more time being taken if the mini-trial does not resolve the matter in the defendant’s favour. If it did not, the matter would have to proceed to trial in any event, as there are issues that must be determined even if the limitation period has not expired. The defendant has raised the issue of lack of consideration, which must be determined at trial if the limitation period has not expired.
[28] Authorities relied on by the parties include Hryniak v. Mauldin, 2014 SCC 7, [2014] 1 S.C.R. 87; Bank of Nova Scotia v. Williamson (2009), 2009 ONCA 754, 97 O.R. (3d) 561 (C.A.); Royal Bank v. Tie Domi Enterprises Ltd. (2011), 2011 ONSC 7297, 38 C.P.C (7th) 317 (Ont. S.C.J.); Middleton v. Aboutown Enterprises Inc., 2009 ONCA 466; Buik Estate v. Canasia Power Corp., 2014 ONSC 2959; aff’d 2015 ONCA 352; National Leasing Group Inc. v. Spencer, 2015 ONSC 6165; Khosa v. Homelife/United Realty Inc., 2016 ONCA 3; 3 Genius Corp. v. Locationary Inc., 2015 ONSC 1439; Fleisher Ridout Partnership Inc. v. Tai Foong International Ltd., [2012] O.J. No. 4229 (Small Claims Court); Ainsley v. Fitzpatrick, 2013 ONSC 3338; and Re Temple (2012), 2012 ONSC 376, 109 O.R. (3d) 374 (S.C.J.).
Analysis
[29] The issue of whether the limitation period, assuming it was triggered, was extended by an acknowledgment to pay, or promise to pay, in October, 2014, is an interesting one. It would be necessary to determine whether the text messages exchanged between the parties constitute an acknowledgement or promise by the defendant, and whether they were “signed” as required by section 13(10) of the Limitations Act, 2000. In turn, this would require an analysis of the Electronic Commerce Act, 2000.
[30] None of these issues arise, however, unless it can be said that there was a demand for payment in 2012, which would have commenced the running of the limitation period. If there was no such demand, this action was commenced in time and these interesting issues do not arise.
[31] The issue before me, then, is whether I can make a fair and just determination of the issue, that is, whether a demand was made in 2012, based on the record before me, or whether I can do so by holding a mini-trial. In my view, the answer to both questions is no.
[32] The principles that govern the question of whether a fair and just determination can be made in these circumstances were articulated by Karakatsanis J. in Hyrniak v. Mauldin, at paras. 49-51, as follows:
[49] There will be no genuine issue requiring a trial when the judge is able to reach a fair and just determination on the merits on a motion for summary judgment. This will be the case when the process (1) allows the judge to make the necessary findings of fact, (2) allows the judge to apply the law to the facts, and (3) is a proportionate, more expeditious and less expensive means to achieve a just result.
[50] These principles are interconnected and all speak to whether summary judgment will provide a fair and just adjudication. When a summary judgment motion allows the judge to find the necessary facts and resolve the dispute, proceeding to trial would generally not be proportionate, timely or cost effective. Similarly, a process that does not give a judge confidence in her conclusions can never be the proportionate way to resolve a dispute. It bears reiterating that the standard for fairness is not whether the procedure is as exhaustive as a trial, but whether it gives the judge confidence that she can find the necessary facts and apply the relevant legal principles so as to resolve the dispute.
[51] Often, concerns about credibility or clarification of the evidence can be addressed by calling oral evidence on the motion itself. However, there may be cases where, given the nature of the issues and the evidence required, the judge cannot make the necessary findings of fact, or apply the legal principles to reach a just and fair determination.
[33] As stated by Karakatsanis J. at para. 50, the main question is whether determining the issue on a motion for summary judgment can give me confidence that I can find the necessary facts and apply the relevant legal principles so as to resolve the dispute.
[34] In this case, to accept the submission made by the defendant I would need to make credibility findings in order to determine whether a demand for payment was made in 2012. In my view, it would not be fair to the plaintiff for me to do so, or attempt to do so, without actually hearing from the plaintiff and assessing her version of the facts as related in the witness box. While there are undoubtedly weaknesses in her version of the events, I cannot realistically give her version of the events the assessment it deserves without hearing from her. I am not persuaded that I can fairly and justly make the necessary credibility findings without hearing oral evidence.
[35] While, as noted, there are weaknesses in the plaintiff’s evidence, there are also weaknesses in the defendant’s evidence. Before December, 2014, any communications that are alleged to be demands were only verbal. None were in writing. The onus is on the defendant to establish that a demand was made. A demand must be clear and unequivocal: Bank of Nova Scotia v. Williamson, supra, at para. 20. It will be important, in my view, for the trier of fact to assess all of the competing evidence as it is given from the witness box.
[36] I am also not persuaded that I can, or should, make the credibility findings only after conducting a mini-trial. I agree with the plaintiff that a mini-trial will only be advantageous if I find, after conducting such a mini-trial, that the version of events asserted by the defendant should be accepted. If I find that the version of the events as asserted by the plaintiff should be preferred, it will be necessary to proceed to trial in any event. From my assessment of the matter at this point, I do not think a trial will be much longer, if at all, than a mini-trial. Thus, I do not think this is a case where conducting a mini-trial would be appropriate.
[37] For these reasons, I conclude that I should not determine the issue before me on a motion for summary judgment. The matter must proceed to trial.
Disposition
[38] For the foregoing reasons, the motion for summary judgment is dismissed.
[39] I will entertain brief written submissions as to costs, not to exceed three pages, together with a costs outline. Counsel for the plaintiff shall have five days, and counsel for the defendant an additional five days. Counsel for the plaintiff shall have three days to reply.
Gray J.
Released: March 18, 2016
CITATION: Talsky v. Waxman, 2016 ONSC 1953
COURT FILE NO.: 6715/14
DATE: 2016-03-18
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
ALINA TALSKY
Plaintiff
– and –
RANDALL COREY WAXMAN
Defendant
REASONS FOR JUDGMENT
GRAY J.
Released: March 18, 2016