Court File and Parties
COURT FILE NO.: CV-14-501673 MOTION HEARD: JUNE 28, 2016
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Sue DeGrandis and Barry DeGrandis v. 1123951 Ontario Limited c/o Libero Building Services
BEFORE: MASTER R. A. MUIR
COUNSEL: Paul Adam for the plaintiffs Robert J. Kennaley for defendant
REASONS FOR DECISION
1There are two motions before the court for similar relief. The plaintiffs and the defendant seek orders relating to the attendance of a non-party at discovery and for the service of further and better affidavits of documents.
2This is a home renovation construction dispute. The plaintiffs are the homeowners. The defendant was the plaintiffs’ trade contractor for certain underpinning and excavation services. The amounts in issue are relatively modest, at least in terms of construction litigation. The plaintiffs claim $135,000.00 in damages. The defendant has counterclaimed for approximately $44,000.00 in damages.
3The plaintiffs claim the defendant has overbilled and failed to provide the plaintiffs with credits for amounts directly paid by the plaintiffs. The plaintiffs also claim the defendant’s alleged incompetence caused them to incur additional out of pocket costs. The plaintiffs also claim damages for delay, wrongful termination of the contract and costs to remedy and complete the defendant’s work.
4The defendant seeks damages for the balance owing on its contract, additional work outside of the original scope of work and damages arising from the extended duration of the contract including lost productivity and lost profits.
5Examinations for discovery were originally scheduled for January 2016. They did not proceed due to a dispute over the attendance of a non-party. The parties then brought these motions that were eventually argued before me on June 28, 2016.
6The issue with respect to the attendance of the non-party was argued first. The defendant wishes to have a non-party present at discovery in order to assist counsel. The non-party in question is Sandra Clementi, the spouse of the principal of the defendant corporation. She is apparently not an employee, officer or director of the defendant. Ms. Clementi has assumed the role of unpaid law clerk for this litigation in order to keep costs down. It also appears that Ms. Clementi provides unpaid labour to the defendant from time to time apart from her role in this litigation.
7First, the case law relied upon by both sides establishes that the court has the discretion to permit the attendance of a non-party at discovery in order to assist counsel, depending on the circumstances of the particular case. See Poulton v. A & P Properties Limited at paragraphs 11-19.
8I agree with the plaintiffs that the attendance of the non-party must not disrupt the examination process and the non-party’s role must be limited to assisting counsel. In my view, Ms. Clementi’s attendance is appropriate in the circumstances of this case. A significant number of documents will need to be organized and reviewed. The amounts of the claims are relatively modest but there are many discreet issues to cover. I see nothing improper about her attendance so long as her role is limited to involvement similar in nature to a law clerk or articling student assisting counsel. It appears to me that this is a sensible way to reduce expenses and the overall cost of litigation.
9However, there must be limits. Ms. Clementi is not to take on the role of witness or assist the defendant’s representative in answering questions. A witness on discovery has a duty to inform himself of the matters in issue and the defendant’s witness should obviously do so. I also note that the defendant has undertaken to the court not to call Ms. Clementi as a witness at trial. Of course, I agree that advance notice of Ms. Clementi’s attendance should have been provided to the plaintiffs. However, the lack of notice is a matter for costs and in my view does not affect the defendant’s entitlement to have Ms. Clementi present at discovery.
10Ms. Clementi shall be entitled to attend the examinations for discovery in accordance with the terms of these reasons for decision.
11The production motions were argued next. In determining the issues relating to the scope of production, I have considered the relevance test set out in Rule 30.02 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 (the “Rules”). It is important to remember that relevance is determined by the pleadings. I am especially mindful of the proportionality requirements of Rules 1.04(1.1) and 29.2.
12It is necessary to make a few observations about the role of proportionality in the circumstances of this action. It is certainly true that the total amount claimed by the plaintiffs exceeds the monetary threshold under the Rule 76 simplified procedure. This action has properly been brought as an ordinary proceeding. However, it is important to note that no one head of damages exceeds $100,000.00. In fact, all of the discreet claims are significantly less than $100,000.00 on an individual basis and some are within the monetary jurisdiction of the small claims court. By way of example, the plaintiffs seek payment of $45,000.00 for incomplete work, $4,000.00 for architectural fees unnecessarily incurred, $3,000.00 for storage and $75,000.00 for costs to complete. Within each of the major heads of damages are various discreet sub-heads which rarely amount to more than a few thousand dollars.
13The same can be said for the defendant’s counterclaim. The balance owing on its contract is alleged to be $6,000.00. The contract extras claimed amount to $13,000.00. Its productivity loss claim is estimated to be $22,000.00.
14I understand that these are significant amounts of money for individuals and small businesses. However, they are not significant amounts when it comes to litigation in the Superior Court of Justice, especially under ordinary procedure. The costs of pursuing these claims may very well exceed the amounts in issue. The Rules require this court to consider this factor when making discovery and other procedural orders.
15I also agree with the submissions of counsel for the defendant with respect to a litigation “culture shift”. The Supreme Court of Canada has made it abundantly clear that there needs to be a culture shift in how the parties, the bar and the courts approach the resolution of civil disputes. This approach is reflected in Justice Karakatsanis’ observations in Hryniak v. Mauldin, 2014 SCC 7 , [2014] 1 SCR 87 beginning at paragraph 23:
23 This appeal concerns the values and choices underlying our civil justice system, and the ability of ordinary Canadians to access that justice. Our civil justice system is premised upon the value that the process of adjudication must be fair and just. This cannot be compromised.
24 However, undue process and protracted trials, with unnecessary expense and delay, can prevent the fair and just resolution of disputes. The full trial has become largely illusory because, except where government funding is available, ordinary Canadians cannot afford to access the adjudication of civil disputes. The cost and delay associated with the traditional process means that, as counsel for the intervener the Advocates' Society (in Bruno Appliance ) stated at the hearing of this appeal, the trial process denies ordinary people the opportunity to have adjudication. And while going to trial has long been seen as a last resort, other dispute resolution mechanisms such as mediation and settlement are more likely to produce fair and just results when adjudication remains a realistic alternative.
25 Prompt judicial resolution of legal disputes allows individuals to get on with their lives. But, when court costs and delays become too great, people look for alternatives or simply give up on justice. Sometimes, they choose to represent themselves, often creating further problems due to their lack of familiarity with the law.
26 In some circles, private arbitration is increasingly seen as an alternative to a slow judicial process. But private arbitration is not the solution since, without an accessible public forum for the adjudication of disputes, the rule of law is threatened and the development of the common law undermined.
27 There is growing support for alternative adjudication of disputes and a developing consensus that the traditional balance struck by extensive pre-trial processes and the conventional trial no longer reflects the modern reality and needs to be re-adjusted. A proper balance requires simplified and proportionate procedures for adjudication, and impacts the role of counsel and judges. This balance must recognize that a process can be fair and just, without the expense and delay of a trial, and that alternative models of adjudication are no less legitimate than the conventional trial.
28 This requires a shift in culture. The principal goal remains the same: a fair process that results in a just adjudication of disputes. A fair and just process must permit a judge to find the facts necessary to resolve the dispute and to apply the relevant legal principles to the facts as found. However, that process is illusory unless it is also accessible - proportionate, timely and affordable. The proportionality principle means that the best forum for resolving a dispute is not always that with the most painstaking procedure.
29 There is, of course, always some tension between accessibility and the truth-seeking function but, much as one would not expect a jury trial over a contested parking ticket, the procedures used to adjudicate civil disputes must fit the nature of the claim. If the process is disproportionate to the nature of the dispute and the interests involved, then it will not achieve a fair and just result.
[Footnotes omitted]
16The culture shift referred to by Justice Karakatsanis goes beyond summary judgment motions. It infuses all aspects of civil procedure including, I might note, the allocation of the court’s finite judicial resources. See Farmers Oil & Gas Inc. v. Ontario (Ministry of Natural Resources), 2015 ONSC 223 at paragraphs 4-8.
17These principles are certainly applicable to the issue involving the attendance of the non-party at discovery. As indicated above, I view that request as a cost-saver. However, it is my view that these principles are even more compelling with respect to the parties’ competing production motions.
18I have reviewed and carefully considered the various production requests made in both motions. In my view, when compared to the pleadings, the vast majority of the documents requested are indeed “relevant” to matters in issue in this proceeding. The issues raised by the pleadings are very broad. They cover almost every aspect of the project. The claims made involve issues relating to scope of work, incomplete work, extras, billing, accounting, delay, completion costs, termination of the contract, the competency of the contractor, productivity loss, lost profits and so on and so on. Counsel for the defendant objected to the plaintiffs’ production request on the basis that it amounted to a request for the defendant’s entire file in relation to this project. That may be so, but I find it difficult to see how the plaintiffs’ requests are beyond the scope of relevance given the broad expanse of the pleadings.
19In the circumstances of this action, I am simply not prepared to make an order for the production of what would appear to be thousands of additional documents that would take months to assemble and many more months to review and assess. Many additional thousands of dollars would be spent on legal fees. This action was started more than two years ago and has not progressed past the pleadings stage. The parties were prepared to conduct discoveries in January 2016 on the basis of the production to date. These motions seem to have been generated by a dispute over the attendance of a non-party at discovery rather than any actual serious concern about the scope of production. In my view, a middle course must be found. Such an approach is consistent with the proportionality requirements of the Rules and the direction of the Supreme Court of Canada in Hryniak. It is also consistent with the approach commonly adopted by reference masters in Toronto hearing similar home renovation matters pursuant to the provisions of the Construction Lien Act, RSO 1990, c. C30.
20The parties shall adopt the following approach with respect to further production and discovery. Each side shall review their files once again bearing in mind the production requests made on these motions. Each side shall produce what they consider to be any additional key documents they intend to rely on at trial. This additional production shall be made by July 29, 2016. Oral examinations for discovery shall be completed by September 2, 2016. The parties’ production motions are otherwise dismissed.
21This order is made without prejudice to either side renewing their requests for additional production after oral discovery. It is my hope, however, that by following this path, the parties will narrow the issues between them and be better able to focus on the real and significant and cost effective areas of dispute.
22Counsel shall confer and attempt to resolve the issue of the costs of this motion and the costs thrown away as a result of the cancelled discoveries. If the parties are unable to agree, they shall provide the court with brief written submissions by no later than July 21, 2016.
Master R.A. Muir
DATE: June 29, 2016