CITATION: GENSTEEL DOORS ONTARIO INC. v. ALL CAN DOORS & HARDWARE INC., 2016 ONSC 2026

COURT FILE NO.: CV-15-542010

MOTION HEARD: MARCH 17, 2016

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Gensteel Doors Ontario Inc.

v.

All Can Doors & Hardware Inc., Michael Mammoliti a.k.a. Michael Thomas Mammoliti and Giacomo Mammoliti

BEFORE: MASTER R.A. MUIR

COUNSEL: M. Gayed for the moving parties/defendants S. Turajlich for the responding party/plaintiff K. Anniko, counsel to the lawyer for the defendants

REASONS FOR DECISION

[1] The defendants seek various forms of relief on this motion. They ask for an order setting aside their noting in default. They also request an order that this action be continued under ordinary procedure rather than simplified procedure as chosen by the plaintiff. Finally, they seek an order striking the statement of claim, with leave to amend, on the basis that the plaintiff has failed to plead the necessary material facts required by the rules of pleading.

[2] The plaintiff is not opposed to an order setting aside the defendants’ noting in default.

[3] This action arises out of the sale by the plaintiff of various doors and related hardware to the defendant All Can Doors & Hardware Inc. (“All Can”). The plaintiff alleges that All Can has failed to pay the plaintiff for these products. The amount of $36,410.94 is allegedly owing to the plaintiff by All Can.

[4] The plaintiff has also made a claim against the individual defendants pursuant to the trust provisions of the Construction Lien Act, RSO 1990 c C.30. The plaintiff has made an additional claim pursuant to the oppression remedy provisions of the Business Corporations Act, RSO 1990 c B.16. The plaintiff seeks various declaratory relief and mandatory orders in relation to its claims.

[5] The defendants’ motion to strike is brought pursuant to Rule 25.11 of the Rules of Civil Procedure, RRO 1990, Reg. 194 (the “Rules”). The defendants argue that the plaintiff’s statement of claim fails to meet the minimum level of material fact disclosure required by Rule 25.06(1) which requires that every pleading contain a concise statement of the material facts relied upon in support of a party’s claim or defence but not the evidence by which those facts are to be proved. As well, the defendants rely on Rule 25.06(8), which requires full particularity when pleading breach of trust or other claims similar in nature. The statement of claim is so deficient, the defendants assert, that is should be struck out in its entirety, with leave to amend.

[6] The defendants rely on the decision of Master Sandler in Copland v. Commodore Business Machines Ltd., 1985 CanLII 2190 (ON SC), [1985] OJ No. 2675 (SC - Master) where he states at paragraph 15:

Rule 25.06(1) mandates a minimum level of material fact disclosure and if this level is not reached, the remedy is not a motion for "particulars", but rather, a motion to strike out the pleading as irregular. It is only where the minimum level of material fact disclosure has been reached, that the pleading becomes regular. Thereafter, the discretionary remedy of "particulars" under rule 25.10 becomes available, if the party seeking particulars can qualify for the relief under the provisions of that rule.

[7] Master Sandler goes on to point out at paragraph 16 of Copland:

Thus it becomes necessary, in any specific type of action, to determine the minimum level of material fact disclosure required for any particular pleading, in order to determine if the pleading is or is not regular. This is not an easy task by any means, and much common sense must be brought to bear in this endeavour. As well, the purpose and function of pleadings in modern litigation must be kept constantly in mind. It is often difficult to differentiate between, and articulate the difference between material facts, particulars, and evidence.

[8] I agree with the defendants that the statement of claim contains a minimal amount of material fact disclosure when it comes to identifying the materials supplied, the price of those materials and the projects involved. The statement of claim does not itemize the invoices in issue or specify what products were supplied, when they were supplied or for what purpose. The allegations are very general.

[9] However, it is important to note that on a motion to strike pursuant to Rule 25.11, the pleading must be read generously with allowance for inadequacies due to drafting deficiencies. See 3414493 Canada Inc. v. 505896 Ontario Ltd., [2007] OJ No. 3988 (SCJ – Master) at paragraph 61.

[10] In my view, the pleading is sufficient. Striking the statement of claim in its entirety is not an appropriate remedy in the circumstances of this action. Such an order would not be in keeping with the common sense approach referenced by Master Sandler in his decision in Copland.

[11] The basic elements of the claim have been pleaded. Materials were ordered, supplied and not paid for. It is alleged that All Can received payment on the projects for which the plaintiff supplied its materials but did not make payment to the plaintiff. The accounting details for those projects are solely within the knowledge of All Can and not the plaintiff. The best the plaintiff can do is point to All Can’s purchase orders and its invoices. Although the plaintiff has only done this in a general fashion in the statement of claim, the evidence shows that full particulars were subsequently provided to the defendants by way of copies of the outstanding invoices and the related purchase orders. As a result, the defendants now appear to be fully aware of the specifics of the plaintiff’s claim. They have not provided the court with any evidence to suggest that the particulars are not within their knowledge or that they are unable to plead to the statement of claim. It may be that the plaintiff should have provided formal particulars of these allegations. However, the defendants did not serve a demand for particulars and no such relief is asked for on this motion.

[12] With regard to the remaining issue, I agree with the defendants that this action should be governed by ordinary procedure. Although the monetary relief sought is clearly less than $100,000.00, the related declaratory relief and mandatory orders would appear to bring this proceeding outside of the ambit of the Rule 76 simplified procedure. See the decision of the Divisional Court in De Rose & Associates Ltd. v. Brugnano, 2007 CarswellOnt 7122 (Div Ct) at paragraph 6. The parties were unable to locate any other authorities dealing with this issue.

[13] I therefore order as follows:

(a) the defendants’ noting in default is hereby set aside;

(b) this action shall be governed by the ordinary procedure as set out in the Rules;

(c) the defendants shall deliver their statement(s) of defence by April 22, 2016;

(d) the relief with respect to striking the statement of claim is dismissed; and,

(e) if the parties are unable to resolve the issue of costs, including the costs of counsel to the lawyer for the defendants, they shall provide the court with brief submissions in writing by April 22, 2016.

Master R.A. Muir

DATE: March 22, 2016