Court File and Parties
Court File No.: 11-CV-433059 Heard: April 21, 2016 Superior Court of Justice - Ontario
Re: Sidhu v. Barburitto Restaurants Inc.
Before: Master Joan Haberman
Counsel: Suleman, S. for the moving parties Cooper, M. for the responding party
Endorsement
Master Haberman:
[1] This motion represents yet another example of how a seemingly small error can result in dramatic and costly repercussions. In this instance, the error was that of a court registrar.
Preliminary Issue
[2] Counsel for the moving party attended with a supplementary affidavit he wished to hand up in court. Defence counsel objected. I advised counsel for the moving party that if he wished to enter this new material, which ought to have been delivered earlier, the matter would have to be adjourned to give opposing counsel an opportunity to review and consider it, but that his client would have to pay costs thrown away today. He was of the view that he could proceed without it and he decided to do so. On that basis, we proceeded.
Facts: The Evidence
[3] On August 12, 2014, Master Abrams made an order that, among other things, extended the deadline by which this action was to have been set down for trial from October 16, 2014 to December 31, 2015. Failure to comply with the new deadline would result in the action being dismissed by the registrar with costs.
[4] This order was entered properly into the computerized case history. However, the registrar who entered this data neglected to adjust the timelines at the end of the case history. The timelines are critical, as this is what the computer scans in order to generate dismissal orders. As the timelines were not adjusted in this case, they failed to capture the fact that the master had extended the deadline by which the action had to be set down for trial. The computer was therefore prompted to dismiss the action upon the arrival of the previous deadline and, as a result, the action was dismissed prematurely, on October 16, 2014, though this deadline had been displaced by the master’s extension order.
[5] Both parties received a copy of and were aware of this dismissal order, though neither seemed particularly concerned about it. They both treated the dismissal order as something sent it error, so of no import. They both continued to proceed on the basis of the extended deadline set by Master Abrams of December 31, 2015, continuing to take steps to move the action forward.
[6] On the plaintiff’s side, this issue was complicated by the fact that Mr. Rivard, counsel who was handling the file at the time the dismissal order was issued, has since left the firm and he has filed no affidavit to explain his thinking. Though I am told efforts were made to engage his cooperation, no evidence to that effect was filed.
[7] This motion was further complicated by moving counsel having failed to notify Law Pro and seek their guidance in this matter. It has been my observation that, when notified, they always appoint counsel to argue these motions and moving counsel was so advised. However, despite my comments, Mr. Suleman did not seek an adjournment to that end. He was therefore left to support what his former colleague had and had not done by guessing at what was in Rivard’s mind during this time frame.
[8] As a result, the plaintiffs filed one affidavit, only, the affidavit of the plaintiff, Dustin Singh Sidhu. There is no affidavit from counsel with carriage to respond to some of the defendant’s allegations or to explain why no steps were taken to have the dismissal order set aside.
[9] Sidhu explained that the action was brought under the Arthur Wishart Act and flowed from the purchase of a franchise. The claim was issued by another law firm in 2011 and on July 18, 2014, the plaintiffs retained Mr. Rivard, of the firm that still represents them. He remained their counsel until January 15, 2061, when he left the firm, at which time Mr. Suleman stepped in.
[10] Master Abrams’ order extending the set down deadline was made within a month of Rivard going on record. This is what Sidhu had to say about that order:
Paragraph 10: Although we were aware that a timetable was entered into, we were not aware of the repercussions from not following it, as Mr. Rivard informed us that it was not important, as we could always get an extension, as long as we moved the litigation along.
[11] Sidhu does not say that he never saw the order which clearly states what the repercussions: dismissal of the action.
Paragraph 12: Mr. Rivard subsequently informed my father and me that this Order was set aside, as it should not have been sent since the matter was case-managed by Master Abrams.
[12] In fact, there is nothing in the case history to suggest that Master Abrams was case managing this action. Even if she had been, that would not have prevented the court from dismissing the action for delay. Sidhu is not correct when he states that the order should not have been sent. The error was not that it was sent – the error was that it was issued and it was issued as a result of registrar’s failure to adjust the timelines for the action. The computer did precisely what it was programmed to do by sending out a dismissal order just after the expiry of the last deadline it was informed of.
Paragraph 26: Mr. Rivard had not informed my father or me that the action would be dismissed if not set down by the end of the year. Although we originally had thought that there was a strict timeline, Mr. Rivard consistently had advised that due to litigation delays, the timetable would be extended.
[13] Again, the order itself made that clear. What is not clear is why the plaintiffs believed the timeline was strict if Rivard repeatedly told them that was not the case. It is also not clear why Rivard told them that he had the order set aside if, in his view, it was not important.
Paragraph 27: We consistently informed Mr. Rivard that we wanted the case to move forward quickly, but were told multiple times by Mr. Rivard that the timeline does not apply since the case is moving forward.
[14] Again, the timing is not clear. When did Rivard tell the plaintiff that he had the order set aside relative to his having told them “multiple times” that the timelines did not matter?
[15] Although there is a certain degree of confusion in Sidhu’s affidavit, there is the nugget of a story there that makes sense. What I take from it is the following: he and his father wanted the action to proceed. They believed the timetable was serious and had to be adhered to. They asked about that and were repeatedly told by Rivard that that was not the case. At some point, Rivard told them that, in any event, he had the order set aside.
[16] The confusion in the evidence may well have been the result of how these issues were presented to Sidhu by his former counsel, Rivard, or by his current counsel, Mr. Suleman, as the latter did not appear to have a firm grasp on the facts of the case.
[17] To begin with, it was clear from Mr. Suleman’s factum and from the manner in which he began oral submissions that he believed his efforts should be directed towards setting aside a dismissal order made in December 2015 (see paragraph 16c. of the factum), though such an order does not exist. This was therefore an erroneous starting premise. As the action was dismissed in October 2014, it came to an end at that time. As a result, it was destined to remain in that state unless and until counsel did something about it. There was no dismissal order made in December 2015 as there was nothing left to dismiss – the action had already been terminated.
[18] As matters stand, the registrar lacked authority to dismiss the action in October 2014 in view of Master Abrams’ order. This is what I tried to bring home to counsel at the outset of the hearing, but defence counsel was of the view that he still had a compelling argument to make.
[19] The practice in cases such as these, where a dismissal order is the result of court staff error, is to phone the trial coordinator who can remedy the problem without the need for a court motion. However, this approach can only be used if it is done promptly. There is no explanation in the plaintiffs’ evidence as to why this was not handled quickly. Sidhu states that he and his father had been told by Rivard that the order had, in fact, been set aside when that was clearly not the case. Without Rivard’s evidence, all of this remains shrouded in mystery.
[20] It is important to note that there is nothing in the evidence to indicate that the defendant found anything unusual about this outstanding dismissal order. They continued to participate in discoveries and to treat the action as if it were intact, unaffected by the October 2014 dismissal order. They had their eye on the December 2015 deadline, and though they now complain that nothing was done to set aside the October 2014 dismissal order, they do not appear to have expressed any concern contemporaneous with its issuance. Both sides appear to have treated the dismissal order as if it was of no import, simply the result of an error.
Prejudice
[21] The defendant raises two items which they present as “real prejudice”. The first has not been well-supported by particulars. Further, despite the defendant also being of the erroneous view that this motion was about setting aside a dismissal order made in December 2015, they point to an event that occurred far earlier in the piece as a second basis for asserting prejudice.
[22] The first issue they raise concerns what they say is their inability to count on the evidence of Kim Berry at trial. They note that he is in his 70’s, but fail to indicate which end of that decade they refer to. They state that he suffers from health problems, again, without details as to the nature of the problems, how they affect him and his prognosis. Finally, they claim that his memory is now impaired, providing no source for this information and no hint as to when the issue began. They claim that all of this could create issues with his testimony. There is no explanation how or when this became a concern and whether it was after the actual set down deadline of December 31, 2015 set by the master.
[23] Further, the defendants want to call Berry because the productions include his e-mail containing a copy of a financial statement that the plaintiffs claim not to have received. It is their submission that the fact that it was received would be determinative of the plaintiffs’ claim for rescission and that Berry’s evidence would address that issue. As all of this was embodied in writing (the e-mail and the statements), if Berry’s memory really is a concern, these documents could assist him in reconstructing these events.
[24] The second aspect of alleged prejudice involves the defendants’ inability to call Shay Atia as a witness regarding receipt of the full franchise disclosure package. The impediment appears to be the fact that he moved to Australia, but he did so approximately two years ago, before Master Abrams’ order extending the set down deadline.
Law, Analysis and Conclusion
[25] I note neither counsel provided any of the 2015 or later cases that emerged from the Court of Appeal, which have clarified and simplified the approach to be taken on these motions.
[26] The 4 Reid factors remain critical, and the approach is still a contextual one, such that all relevant factors must be considered. In H.B. Fuller Company v. Rogers (Law Office) 2015 ONCA 173, the Court of Appeal noted the all of the circumstances of each case had to be considered in order to arrive at a just result.
[27] There, the Court emphasized the fact that, while the plaintiff has primary responsibility for moving a case along, the defendant’s conduct is also relevant. It is important, in the case before this court, to note that neither the plaintiff not the defendant felt any impetus to deal with the October 2014 dismissal order. Each assumed that because it was an error, it could be ignored and that is precisely what they both did. The defendants apparently conducted examinations for discovery without expressing any concerns that it made no sense to do so in the context of an action that was, on the face of the record, defunct.
[28] It is the plaintiffs’ uncontroverted evidence that they expressed concern to Rivard about compliance with the master’s timetable and that at some point, Rivard advised them that he had obtained an order to set aside the October 2014 dismissal order. In fact, however, he did not actually do so.
[29] In Fuller, supra, the Court discussed the reference made by earlier cases to the tension between having cases heard on the merits and dealing with cases in a timely and efficient manner. They concluded that the weight of authority favoured the first policy consideration, such that there appears to be a bias in favour of hearing cases on the merits.
[30] That bias was found to be all the more pronounced where the delay results from an error committed by counsel. The Court quoted from Habib v. Mucaj, 2012 ONCA 880, where it was held that the court should be primarily concerned with the rights of litigants rather than the conduct of their counsel.
[31] In this case, giving Rivard the benefit of the doubt, it appears he was operating under misconceptions regarding the importance of a court-ordered deadline; the fact that he should be concerned about receipt of a dismissal order, made in error or otherwise; and unaware that this was not an error that would correct itself. He had to deal with it or the status of the action would remain as “inactive”. This would ultimately have prevented him from setting the action down for trial, thereby preventing him from complying with the December 2015 deadline that he was working towards.
[32] Rivard was apparently also unaware of that he could correct the court’s error by simply calling the trial coordinator’s office. Admittedly, this is not a formal protocol. It is not written down anywhere that I am aware of but rather, it is the sort of thing that counsel learn through word of mouth. It is also not a well-kept secret as many counsel pursue this path. While Rivard may not have been aware of it, and though Mr. Suleman of the same firm now has access to his file for these plaintiffs, no evidence was filed to suggest that Rivard ever took any steps to explore what he could have done to correct this court error. From the record before this court, it appears he simply ignored it. Absent Rivard’s evidence, it remains unclear why he believed he needn’t do anything about the order or why he apparently advised his clients that he had dealt with it.
[33] In Labelle v. Canada (Border Services Agency), 2016 ONCA 187, the Court of Appeal held that a party should not suffer the irrevocable loss of their ability to proceed with their action as a result of the inadvertence of their counsel, in that case, to request a status hearing, in this case to figure out that he had to and how to go about dealing with a dismissal order made prematurely.
[34] The defendants note that none of this appears to have been inadvertent and in the absence of evidence from Rivard is it difficult to understand. However, the Court of Appeal has regularly directed lower courts to focus on the conduct of the plaintiff, not that of his lawyer, unless there appears to have been a deliberate intention to refrain from taking steps to advance the action. That does not appear to be the case here. Instead, it seems Rivard may have failed to familiarize himself with the Rule 48.14 regime.
[35] As was the case in Labelle, supra, there is no evidence here that the plaintiffs’ delay, such as it is, was the result of a deliberate decision not to take steps in the proceeding. In Labelle, the main reason for the delay was found to be counsel not knowing what to do about the fact that two of the defendants were in CCAA protection. Here, the delay, at least insofar as dealing with the October 2014 dismissal order, appears to have been the result of Rivard not understanding that it had to be set aside or it would have precluded his ability to set the action down within the extended deadline.
[36] In Fuller, supra, the Court stated that when focusing on the rights of litigants, this means all litigants, which explains why prejudice to the defendant enters into the deliberations.
[37] In that context, the question to pose is whether the defendant suffered non-compensable prejudice as a result of the delay, whether or not a fair trial is still possible, and even if it is, whether it is just that the principle of finality and the defendant’s reliance on the security of its position should nonetheless prevail.
[38] In Labelle, supra, Court dealt with prejudice head-on, reminding us that while it is a key consideration, the only prejudice that is relevant is that caused by the plaintiff’s delay. Prejudice does not enter the debate if it pre-dated delay or stemmed from the defendant’s failure to take steps that could have alleviated the prejudice.
[39] When examining the alleged prejudice suffered by the defendant in this case, I have already noted that there is insufficient evidence regarding Berry to really get a sense of why his age and health issues amount to “real prejudice”. There are too many unanswered questions to make this an inevitable conclusion. Further, the defence want to rely on his evidence in the context of an e-mail and financial statement, both of which can be used to refresh his memory. This addresses another of their concerns.
[40] The other form of prejudice they point to is the absence of Atia from the jurisdiction, but it seems he emigrated before the master’s order extending the set down date. There is no indication that this man’s impending move was raised before the master. I therefore infer that is was something he decided to do, but that they were not aware of. It is not causally relevant to the prejudice discussion.
[41] There is no suggestion in the evidence that the defendants relied on the dismissal order. To the contrary, they ignored it and carried on with discoveries. There is no pronouncement from the defendant’s deponent that they can no longer get a fair trial in these circumstances, nor does the evidence that was filed support such a conclusion.
[42] Another issue the Court dealt with in Fuller, supra that has application here is a defendant’s passivity. They noted that, in the context of what was before them, though the plaintiff bore the onus of conducting the litigation in a proactive manner, it would be unfair to ignore a defendant’s passivity, such that a lack of display of any sense of urgency would undermine a defendant’s ability to claim actual prejudice.
[43] In the case before this court, the only effort made by the defence to press this on came in the form of a reminder to plaintiffs’ counsel in September 2015, while the two attended discoveries of the elder Sidhu. That was almost a full year after the action had been dismissed and only two months before the actual deadline. There was no evidence tendered to demonstrate that there was a campaign of letters or e-mails to get the plaintiffs to move faster.
[44] Further, what the defendant focused on was compliance with the December 31, 2015 deadline. As already noted, the plaintiffs could not have set their action down for trial by this deadline unless and until they had the October 2014 dismissal order set aside. There was no pressure or even suggestion from the defendant that this be done.
[45] One final factor must be considered before we leave the contextual approach and that involves the overhaul of the Rule 48.14 regime. The regime shift occurred only months after Master Abrams’ order. Instead of the action having to be set down for trial within two years of filing of the first defence, this new regime gives a plaintiff five years to do so following the issuance of the claim. As the claim in this action was issued in August 2011, under the current regime, they would have until August 2016 to set the action down for trial.
[46] Case law has already recognized repeatedly that this new approach must be factored into the balance when assessing delay. In the context of all of the facts before the court, it is, in my view, a very persuasive consideration in this case.
[47] In the final analysis, the starting point is here has to be the October 2014 dismissal order and the fact that the registrar had no authority to issue it. This case is unlike what occurred in Findlay v. Van Paasen (2010), 2010 ONCA 204, 318 DLR (4th) 686, where the registrar dismissed the action without having first served a status notice. In that case, that omission amounted to an irregularity. Here, the registrar effectively countermanded a master’s order, such that the dismissal order was a nullity. That is why the practice of setting these orders aside without a motion of any kind has developed. Sadly, there are enough errors of this kind that a practice was called for.
[48] Although I made this point at the outset, both counsel were confused as to the date of the dismissal order they should be dealing with at this stage and defence counsel wanted to argue the motion, as he was still of the view he could make some headway here. He had three points to raise:
- He provided evidence of some delay, mostly attributable to former counsel;
- He noted that he had advised former counsel in September 2015 that he had to get on with matters in view of the fast approaching set down deadline; and
- He alleged prejudice.
[49] To the extent that there was delay here, for the most part, this was caused most recently by the defendant’s inability to conduct the discovery of the elder Sidhu when scheduled, as the interpreter ordered for him did eventually show up, but so long after the scheduled time that defence counsel had already left. It was Mr. Rivard’s responsibility to arrange the interpreter and to ensure he was present when needed. I see no evidence, however, of anything the plaintiffs, themselves, did or failed to do that caused delay.
[50] The defendant’s conduct after receipt of the October 2014 dismissal order was no different than that of the plaintiff. Both seemed to be under the misconception that no action was needed and that they could simply disregard it. That was how both sides conducted themselves so the defendant cannot now raise the plaintiffs’ failure to deal with it as a factor when he was right there with them at discoveries.
[51] At the end of the day, there was only about 3 1/2 months between the ordered set down date and the hearing of this motion. The motion was actually booked in March 2015 and the action would not have been dismissed for delay on January 1, 2016 if it had not been set down the day before as there are always a few days grace given. As a result the alleged delay was even shorter. To the extent that this could be called “delay”, it adds little additional time to the life of the action and is, in any event, attributable, in part, to Rivard’s departure from the firm only weeks after the December 31, 2015 set down date. I am not convinced that the plaintiffs, themselves did anything to hamper the progress of this action.
[52] If the overhaul of the Rule 48.14 is added to the discussion, the deadline for setting the action down trial would not yet have expired.
[53] The defendant raised the fact that the plaintiffs could have set the action down before the end of December 2015. That is not correct. As the action had already been dismissed, the only document the court would have accepted is a notice of motion to set aside the October 2014 dismissal order. The action could not have been set down for trial before the expiry of the December 31, 2015 deadline in view of the fact that the earlier dismissal order still applied.
[54] In addition, no date for mediation had been agreed to, so even if there had been no previous order, this would have stood as an impediment. Any trial record sent for filing would have been returned. Thus, a reminder of the fact approaching deadline in September 2015 was of no import as the October 2014 dismissal order was still on file.
[55] Finally, in so far as the issue of prejudice is concerned, I have already indicated I am not persuaded that any of the prejudice complained of was caused by delay.
[56] Accordingly, it is ordered that:
- the registrar’s order of October 16, 2014 dismissing this action for delay is hereby set aside;
- mandatory mediation shall be scheduled no later than the end of June 2016 and take place as soon thereafter as is practicable, but before the action proceeds to pre-trial; and
- this action shall be set down for trial no later than August 17, 2016, failing which it will be dismissed with costs.
[57] Although the plaintiffs’ position prevailed, they have received an indulgence of the court so this is not a case where costs should follow the event.
[58] Insofar as the defendant is concerned, though my initial view was that this may be a case where they might be entitled to some costs, in writing these reasons I have reached a different conclusion. In my view, neither party should get their costs. If either still wants to argue costs, they can so advise me by fax, copied to the other side, within 30 days.
Master Joan M. Haberman Released: April 26, 2016