Court File and Parties

COURT FILE NO.: 11-CV-426793 MOTION HEARD: November 12, 2015 and February 23, 2016

SUPERIOR COURT OF JUSTICE - ONTARIO

Re: Gayle Jewell and Russell Kitteringham, Plaintiffs

v.

Kids & Company Ltd., Victoria Sopik and Jennifer Nashimi, Defendants

BEFORE: Master Thomas Hawkins

APPEARANCES: Julian Binavince for moving plaintiffs Fax: (416) 477-2847

Howard L. Shankman for responding defendants Fax: (416) 655-4291

Reasons for Decision

Nature of Motion

[1] This a motion by the plaintiffs for an order in part:

(a) granting the plaintiffs leave to set this action down for trial despite the fact that the mandatory mediation requirements of Rule 24.1 of the Rules of Civil Procedure have not been met; (b) varying the timetable order of Master McAfee of August 8, 2014 by extending the deadline for setting this action down for trial; and (c) setting a date for the pre-trial of this action and directing that this action proceed to mediation no later than 30 days prior to the date fixed for the pre-trial.

[2] In deciding this motion, I must bear the following in mind.

[3] First of all, this proceeding before me is not a status hearing. That being so, the plaintiffs do not bear the onus of showing cause why this action should not be dismissed for delay.

[4] Secondly, this is not a motion to set aside an order of the registrar dismissing this action for delay. The registrar has not dismissed this action for delay. In these circumstances, the plaintiffs do not have the onus of meeting the various tests which the courts have applied on motions to set aside a registrar’s dismissal order.

[5] The following is a history of the events leading up to this action and of this action from its inception forward.

| Date | Event --- SYSTEM INSTRUCTIONS: You are an expert in processing caselaw files. Your task is to output the entire file in full, including the complete YAML frontmatter and the complete caselaw text exactly as given, with the following modifications:

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citation: "Jewell v Kids & Co. Ltd., 2016 ONSC 5142" parties: "Gayle Jewell and Russell Kitteringham v. Kids & Company Ltd., Victoria Sopik and Jennifer Nashimi" party_moving: "Gayle Jewell and Russell Kitteringham" party_responding: "Kids & Company Ltd., Victoria Sopik and Jennifer Nashimi" court: "Superior Court of Justice" court_abbreviation: "ONSC" jurisdiction: "Ontario" case_type: "motion" date_judgement: "2016-08-17" date_heard: ["2015-11-12", "2016-02-23"] applicant:

• "Gayle Jewell"
• "Russell Kitteringham" applicant_counsel:
• "Julian Binavince" respondent:
• "Kids & Company Ltd."
• "Victoria Sopik"
• "Jennifer Nashimi" respondent_counsel:
• "Howard L. Shankman" judge:
• "Master Thomas Hawkins" summary: > The plaintiffs brought a motion to vary a timetable order, seeking leave to set the action down for trial despite unfulfilled mandatory mediation requirements and an extension of the trial set-down deadline. The defendants opposed, alleging prejudice due to delay and missing documents related to a fraudulent conveyance claim. The court found that both parties contributed to the delay in procedural steps, particularly regarding mediation and document exchange. The motion was granted, varying the timetable to set new deadlines for mediation, setting the action down for trial, and for defendants to serve affidavits of documents, as no inordinate delay or actual prejudice to the defendants was established. interesting_citations_summary: > The decision applies the principles from Carioca’s Import & Export Inc. v. Canadian Pacific Railway, 2015 ONCA 592, emphasizing that while plaintiffs bear primary responsibility for advancing a case, defendants also have a role in facilitating justice. The court clarified that these principles apply equally to motions to vary timetable orders, not just motions to restore actions to the trial list. It also highlighted that procedural consent orders can be varied by a later order and that speculative claims of prejudice due to missing documents are insufficient without concrete evidence. final_judgement: > The plaintiffs' motion was granted. The timetable order of Master McAfee was varied to set new deadlines: within 15 days for parties to agree on a mediator and mediation date (or for plaintiffs to request assignment of a roster mediator); within 15 days after mediation date is fixed, plaintiffs are to set the action down for trial; and within 20 days, defendants are to serve affidavits of documents. No costs were awarded to either party. winning_degree_applicant: 1 winning_degree_respondent: 5 judge_bias_applicant: 0 judge_bias_respondent: 0 year: 2016 decision_number: 5142 file_number: "11-CV-426793" source: "https://www.canlii.org/en/on/onsc/doc/2016/2016onsc5142/2016onsc5142.html" cited_cases: legislation:
  • title: "Rules of Civil Procedure, R.R.O. 1990, Reg. 194" url: "https://www.ontario.ca/laws/regulation/900194"
  • title: "Consolidated Practice Direction for Civil Actions, Applications, Motions and Procedural Matters in the Toronto Region (effective July 1, 2014)" case_law:
  • title: "Carioca’s Import & Export Inc. v. Canadian Pacific Railway, 2015 ONCA 592" url: "https://www.canlii.org/en/on/onca/doc/2015/2015onca592/2015onca592.html" keywords:
• Timetable order
• Mandatory mediation
• Rules of Civil Procedure
• Delay
• Prejudice
• Affidavits of documents
• Setting down for trial
• Civil litigation
• Master's order areas_of_law:
• Civil Procedure
• Civil Litigation

Court File and Parties

COURT FILE NO.: 11-CV-426793 MOTION HEARD: November 12, 2015 and February 23, 2016

SUPERIOR COURT OF JUSTICE - ONTARIO

Re: Gayle Jewell and Russell Kitteringham, Plaintiffs

v.

Kids & Company Ltd., Victoria Sopik and Jennifer Nashimi, Defendants

BEFORE: Master Thomas Hawkins

APPEARANCES: Julian Binavince for moving plaintiffs Fax: (416) 477-2847

Howard L. Shankman for responding defendants Fax: (416) 655-4291

Reasons for Decision

Nature of Motion

[1] This a motion by the plaintiffs for an order in part:

(a) granting the plaintiffs leave to set this action down for trial despite the fact that the mandatory mediation requirements of Rule 24.1 of the Rules of Civil Procedure have not been met; (b) varying the timetable order of Master McAfee of August 8, 2014 by extending the deadline for setting this action down for trial; and (c) setting a date for the pre-trial of this action and directing that this action proceed to mediation no later than 30 days prior to the date fixed for the pre-trial.

[2] In deciding this motion, I must bear the following in mind.

[3] First of all, this proceeding before me is not a status hearing. That being so, the plaintiffs do not bear the onus of showing cause why this action should not be dismissed for delay.

[4] Secondly, this is not a motion to set aside an order of the registrar dismissing this action for delay. The registrar has not dismissed this action for delay. In these circumstances, the plaintiffs do not have the onus of meeting the various tests which the courts have applied on motions to set aside a registrar’s dismissal order.

[5] The following is a history of the events leading up to this action and of this action from its inception forward.

| Date | Event ---

<div class="solexHlZone lbh-document" id="originalDocument">
<div>
<div>
<div>
<p>COURT FILE NO.: 11-CV-426793</p>
<p>MOTION HEARD: November 12, 2015 and February 23, 2016</p>
<h2>SUPERIOR COURT OF JUSTICE - ONTARIO</h2>
<p>Re: Gayle Jewell and Russell Kitteringham</p>
<p>Plaintiffs</p>
<p>v.</p>
<p>Kids &amp; Company Ltd., Victoria Sopik and Jennifer</p>
<p>Nashimi</p>
<p>Defendants</p>
<p>BEFORE: Master Thomas Hawkins</p>
<p>APPEARANCES: Julian Binavince for moving plaintiffs</p>
<p>Fax: (416) 477-2847</p>
<p>Howard L. Shankman for responding defendants</p>
<p>Fax: (416) 655-4291</p>
<p>REASONS FOR DECISION</p>
<p>Nature of Motion</p>
<div link="/en/#search/origin1=/en/on/onsc/doc/2016/2016onsc5142/2016onsc5142.html&amp;linkedNoteup=&amp;section1=1"><p data-viibes-parag="1" data-viibes-start="0">[ 1 ] This a motion by the plaintiffs for an order in part</p></div>
<p>(a) granting the plaintiffs leave to set this action down for trial despite the fact that the mandatory mediation requirements of Rule 24.1 have not been met;</p>
<p>(b) varying the timetable order of Master McAfee of August 8, 2014 by extending the deadline for setting this action down for trial; and</p>
<p>(c) setting a date for the pre-trial of this action and directing that this action proceed to mediation no later than 30 days prior to the date fixed for the pre-trial.</p>
<div link="/en/#search/origin1=/en/on/onsc/doc/2016/2016onsc5142/2016onsc5142.html&amp;linkedNoteup=&amp;section1=2"><p data-viibes-end="0" data-viibes-parag="2" data-viibes-start="1">[ 2 ] In deciding this motion, I must bear the following in mind.</p></div>
<div link="/en/#search/origin1=/en/on/onsc/doc/2016/2016onsc5142/2016onsc5142.html&amp;linkedNoteup=&amp;section1=3"><p data-viibes-end="1" data-viibes-parag="3" data-viibes-start="2">[ 3 ] First of all, this proceeding before me is not a status hearing. That being so, the plaintiffs do not bear the onus of showing cause why this action should not be dismissed for delay.</p></div>
<div link="/en/#search/origin1=/en/on/onsc/doc/2016/2016onsc5142/2016onsc5142.html&amp;linkedNoteup=&amp;section1=4"><p data-viibes-end="2" data-viibes-parag="4" data-viibes-start="3">[ 4 ] Secondly, this is not a motion to set aside an order of the registrar dismissing this action for delay. The registrar has not dismissed this action for delay. In these circumstances, the plaintiffs do not have the onus of meeting the various tests which the courts have applied on motions to set aside a registrar’s dismissal order.</p></div>
<div link="/en/#search/origin1=/en/on/onsc/doc/2016/2016onsc5142/2016onsc5142.html&amp;linkedNoteup=&amp;section1=5"><p data-viibes-end="3" data-viibes-parag="5" data-viibes-start="4">[ 5 ] The following is a history of the events leading up to this action and of this action from its inception forward.</p></div>
<p>Date</p>
<p>Event</p>
<p>January 23, 2007</p>
<p>Briars Bay Inc. leases premises at 179 Main Street South, Newmarket to Kids &amp; Company Ltd. for use as a child care facility. This lease expires on January 31, 2017.</p>
<p>June 18, 2010</p>
<p>Kids &amp; Company Ltd. obtains license to operate a child care facility at 230 Wellington Street, Aurora.</p>
<p>September 23, 2010</p>
<p>Briars Bay Inc., gives defendants written notice that it had assigned lease of 179 Main Street South, Newmarket premises to Gayle Jewell and Russell Kitteringham.</p>
<p>November 15, 2010</p>
<p>Gayle Jewell and Russell Kitteringham meet with Victoria Sopik of Kids &amp; Company Ltd. There is a dispute as to what happened at this meeting. The plaintiffs say that Ms. Sopik told them at this meeting that Kid’s &amp; Company Ltd. was moving to new premises and would not need the Newmarket leasehold premises after December 31, 2010.</p>
<p>May 18, 2011</p>
<p>Plaintiffs’ lawyer has registrar issue Statement of Claim.</p>
<p>June 16, 2011</p>
<p>All three defendants serve a joint Statement of Defence.</p>
<p>December 14, 2011</p>
<p>All three defendants file their joint Statement of Defence.</p>
<p>October 29, 2013</p>
<p>Plaintiffs’ new lawyers file Notice of Change of Solicitors.</p>
<p>December 14, 2013</p>
<p>Registrar issues Status Notice: Action not on a Trial List (Form 48.C1).</p>
<p>April 4, 2014</p>
<p>Plaintiffs’ lawyers file notice requesting a status hearing, having served it earlier.</p>
<p>April 9, 2014</p>
<p>Registrar issues notice of status hearing.</p>
<p>August 8, 2014</p>
<p>Master McAfee conducts status hearing and sets a timetable for this action on consent. Deadline for setting this action down for trial is July 31, 2015.</p>
<p>October 22, 2014</p>
<p>Defendants’ lawyer serves plaintiffs’ lawyer with defendants’ unsworn affidavit of documents. Defendants never serve a sworn affidavit of documents.</p>
<p>July 28, 2015</p>
<p>Plaintiffs’ lawyers serve trial record by mail. Covering letter proposes that action be mediated by J.M., a non-roster mediator, or that defendants suggest an alternative mediator or mediators. Defence lawyer does not respond.</p>
<p>October 27, 2015</p>
<p>Plaintiffs’ lawyers serve defendants’ lawyer with plaintiffs’ joint affidavit of documents (13 months after timetable deadline) along with motion record for present motion.</p>
<p>November 12, 2015</p>
<p>Argument of present motion begins before me.</p>
<p>February 23, 2016</p>
<p>Argument of present motion before me concludes. I reserve judgment.</p>
<p>Comments on History of Action and Master McAfee’s Timetable Order</p>
<div link="/en/#search/origin1=/en/on/onsc/doc/2016/2016onsc5142/2016onsc5142.html&amp;linkedNoteup=&amp;section1=6"><p data-viibes-end="4" data-viibes-parag="6" data-viibes-start="5">[ 6 ] Master McAfee’s timetable order set deadlines for the service of affidavits of documents, examinations for discovery and for the bringing of discovery-related motions.</p></div>
<div link="/en/#search/origin1=/en/on/onsc/doc/2016/2016onsc5142/2016onsc5142.html&amp;linkedNoteup=&amp;section1=7"><p data-viibes-end="5" data-viibes-parag="7" data-viibes-start="6">[ 7 ] Neither side met the deadline for service of affidavits of documents. The plaintiffs served their affidavit of documents about 13 months late. The defendants never served any sworn affidavit of documents.</p></div>
<div link="/en/#search/origin1=/en/on/onsc/doc/2016/2016onsc5142/2016onsc5142.html&amp;linkedNoteup=&amp;section1=8"><p data-viibes-end="6" data-viibes-parag="8" data-viibes-start="7">[ 8 ] The evidence before me does not indicate that either side ever attempted to set up any examination for discovery of the other side, or that any examinations for discovery were ever conducted in this action. In their motion materials the plaintiffs say that they do not require any examination for discovery of the defendants.</p></div>
<div link="/en/#search/origin1=/en/on/onsc/doc/2016/2016onsc5142/2016onsc5142.html&amp;linkedNoteup=&amp;section1=9"><p data-viibes-end="7" data-viibes-parag="9" data-viibes-start="8">[ 9 ] I note that the express wording of Master McAfee’s timetable order directs all parties to adhere to the timetable deadlines which she set for each party and to carry out the steps assigned to him or her by the dates provided in that order.</p></div>
<div link="/en/#search/origin1=/en/on/onsc/doc/2016/2016onsc5142/2016onsc5142.html&amp;linkedNoteup=&amp;section1=10"><p data-viibes-end="8" data-viibes-parag="10" data-viibes-start="9">[ 10 ] Neither side ever brought a sanctions motion based on the failure of the other side to comply with Master McAfee’s timetable order.</p></div>
<div link="/en/#search/origin1=/en/on/onsc/doc/2016/2016onsc5142/2016onsc5142.html&amp;linkedNoteup=&amp;section1=11"><p data-viibes-end="9" data-viibes-parag="11" data-viibes-start="10">[ 11 ] I do not regard the failure of both sides to conduct examinations for discovery of the other side to be a breach of Master McAfee’s timetable order. Under the Rules of Civil Procedure conducting examinations for discovery is optional, not mandatory.</p></div>
<div link="/en/#search/origin1=/en/on/onsc/doc/2016/2016onsc5142/2016onsc5142.html&amp;linkedNoteup=&amp;section1=12"><p data-viibes-end="10" data-viibes-parag="12" data-viibes-start="11">[ 12 ] That being so, in my view Master McAfee’s order should be interpreted as meaning that if a party intends to conduct an examination for discovery, the at examination is to be completed by the deadline which Master McAfee set, unless the parties agree to extend that deadline. No such extension was ever agreed to here.</p></div>
<div link="/en/#search/origin1=/en/on/onsc/doc/2016/2016onsc5142/2016onsc5142.html&amp;linkedNoteup=&amp;section1=13"><p data-viibes-end="11" data-viibes-parag="13" data-viibes-start="12">[ 13 ] In the present circumstances, the plaintiffs have expressly waived their right to conduct examinations for discovery of the defendants, while the defendants must be taken by implication to have waived their right to do so.</p></div>
<div link="/en/#search/origin1=/en/on/onsc/doc/2016/2016onsc5142/2016onsc5142.html&amp;linkedNoteup=&amp;section1=14"><p data-viibes-end="12" data-viibes-parag="14" data-viibes-start="13">[ 14 ] The situation as the regards the service of affidavits of documents is different. Under the Rules of Civil Procedure it is mandatory for each party to an action to serve an affidavit of documents. Here the two plaintiffs served a sworn joint affidavit of documents about 13 months after the deadline set by Master McAfee. The three defendants never served any sworn affidavit of documents. While both sides breached Master McAfee’s timetable order, the breach by the defendants is the more serious. The plaintiffs are in a position to say, “Better late than never”. The defendants cannot make that statement.</p></div>
<div link="/en/#search/origin1=/en/on/onsc/doc/2016/2016onsc5142/2016onsc5142.html&amp;linkedNoteup=&amp;section1=15"><p data-viibes-end="13" data-viibes-parag="15" data-viibes-start="14">[ 15 ] The way in which Master McAfee’s timetable order deals with the subject of who is to set the action own for and who is to schedule mediation is significant. Most timetable orders provide that the plaintiff (or plaintiffs) is/are to set the action down for trial. Master McAfee’s order is different. It provides that the plaintiffs or any of the defendants are to set the action down for trial and to schedule mediation by July 31, 2015.</p></div>
<div link="/en/#search/origin1=/en/on/onsc/doc/2016/2016onsc5142/2016onsc5142.html&amp;linkedNoteup=&amp;section1=16"><p data-viibes-end="14" data-viibes-parag="16" data-viibes-start="15">[ 16 ] Paragraph 53 of the Consolidated Practice Direction for Civil Actions, Applications, Motions and Procedural Matters in the Toronto Region (effective July 1, 2014) is relevant here. This paragraph provides as follows.</p></div>
<p>Court staff will not accept for filing a trial record (ordinary action) or a notice of readiness for pre-trial conference (Simplified Procedure action) unless the party setting the action down for trial files a Certificate that:</p>
<p>a) form 24.1A (notice of name of mediator and date of session) has been filed with the mediation coordinator;</p>
<p>b) the report by mediator (indicating that the mediation has been concluded) has been filed with the mediation coordinator;</p>
<p>c) an order has been obtained from a judge or case management master exempting the action from mediation; or,</p>
<p>d) an order has been obtained from a judge or case management master extending the deadline for mediation until after the action is set down for trial.</p>
<p>These requirements will apply even where the parties have agreed to postpone a mediation session to a date more than 180 days after the first defence has been filed as permitted by rule 24.1.</p>
<div link="/en/#search/origin1=/en/on/onsc/doc/2016/2016onsc5142/2016onsc5142.html&amp;linkedNoteup=&amp;section1=17"><p data-viibes-end="15" data-viibes-parag="17" data-viibes-start="16">[ 17 ] This action is subject to the mandatory mediation requirements of Rule 24.1.</p></div>
<div link="/en/#search/origin1=/en/on/onsc/doc/2016/2016onsc5142/2016onsc5142.html&amp;linkedNoteup=&amp;section1=18"><p data-viibes-end="16" data-viibes-parag="18" data-viibes-start="17">[ 18 ] On the facts before me, the provisions of clauses (b) to (d) of paragraph 53 of this practice direction do not apply. The provisions of clause (a) do apply to this action.</p></div>
<div link="/en/#search/origin1=/en/on/onsc/doc/2016/2016onsc5142/2016onsc5142.html&amp;linkedNoteup=&amp;section1=19"><p data-viibes-end="17" data-viibes-parag="19" data-viibes-start="18">[ 19 ] By July 31, 2015 plaintiffs’ counsel was not in a position to complete and file with the court registry a Certificate that form 24.1A (notice of name of mediator and date of session) had been filed with the mediation coordinator. This was so because the parties to this action had yet to agree upon a mediator and a date for the mediation session.</p></div>
<div link="/en/#search/origin1=/en/on/onsc/doc/2016/2016onsc5142/2016onsc5142.html&amp;linkedNoteup=&amp;section1=20"><p data-viibes-end="18" data-viibes-parag="20" data-viibes-start="19">[ 20 ] In these circumstances, had plaintiffs’ counsel attempted to file the trial record for this action without completing that Certificate, court registry staff, acting on the authority of paragraph 53 of the Consolidated Practice Direction, would have refused to accept that trial record for filing. The same thing would have happened had defence counsel attempted to file a trial record for this action in these circumstances.</p></div>
<div link="/en/#search/origin1=/en/on/onsc/doc/2016/2016onsc5142/2016onsc5142.html&amp;linkedNoteup=&amp;section1=21"><p data-viibes-end="19" data-viibes-parag="21" data-viibes-start="20">[ 21 ] Here, as the July 31, 2015 deadline for setting this action down for trial was approaching, mandatory mediation of this action had not taken place. Instead, plaintiffs’ counsel wrote defence counsel proposing a particular mediator and, if that mediator were not acceptable, inviting defence counsel to provide his suggestions with respect to a mediator. Defence counsel never responded.</p></div>
<div link="/en/#search/origin1=/en/on/onsc/doc/2016/2016onsc5142/2016onsc5142.html&amp;linkedNoteup=&amp;section1=22"><p data-viibes-end="20" data-viibes-parag="22" data-viibes-start="21">[ 22 ] There is no evidence before me that plaintiffs’ counsel ever attempted to set this action down for trial. I assume that plaintiffs’ counsel was aware of the requirements of paragraph 53 of the Consolidated Practice Direction and that in the circumstances then existing, Toronto court registry staff would have rejected any attempt to set his action down for trial.</p></div>
<div link="/en/#search/origin1=/en/on/onsc/doc/2016/2016onsc5142/2016onsc5142.html&amp;linkedNoteup=&amp;section1=23"><p data-viibes-end="21" data-viibes-parag="23" data-viibes-start="22">[ 23 ] There is no evidence before me that any of the defendants ever attempted to nominate a mediator or to set a date for mandatory mediation. Plaintiffs’ counsel attempted to start the mandatory mediation process. Defence counsel did nothing.</p></div>
<div link="/en/#search/origin1=/en/on/onsc/doc/2016/2016onsc5142/2016onsc5142.html&amp;linkedNoteup=&amp;section1=24"><p data-viibes-end="22" data-viibes-parag="24" data-viibes-start="23">[ 24 ] Plaintiffs’ counsel referred me to [Carioca’s Import & Export Inc. v. Canadian Pacific Railway, 2015 ONCA 592](https://www.canlii.org/en/on/onca/doc/2015/2015onca592/2015onca592.html). There van Rensburg J.A., who delivered the judgment of the Court of Appeal for Ontario, expressed herself as follows (at paragraph 53).

> While this court has stated frequently that the plaintiff bears the primary responsibility for moving a case forward, it has also acknowledged that the conduct of a defendant is a factor, especially where a plaintiff encounters some resistance when trying to move the action along: 1196158 Ontario Inc. , at para. 29. The suggestion that it is normal and acceptable for a defendant, if not to actively delay, to simply wait for the plaintiff to make the next move, may be based on a conventional view of litigation strategy. The objectives of timely and efficient access to justice, and effective use of court resources require all parties to play their part in moving actions forward, and for counsel to act in a way that facilitates rather than frustrates access to justice: Hryniak , at para. 32. For these reasons, although the burden of proof on the motion is on the plaintiff, the conduct all parties in relation to the litigation is relevant in determining whether to restore an action to the trial list.

[25] The motion before me is not a motion for leave to restore an action to the trial list. It is a motion in part for an order varying Master McAfee’s timetable order by extending the deadline for setting this action down for trial. In my view the fact that this is not a motion for leave to restore an action to the trial list makes no difference. The principles which van Rensburg J.A. has expressed in Carioca, supra, apply with equal force here. This is especially so given the fact that Master McAfee’s order respecting the scheduling of mandatory mediation and the setting of this action down for trial directs both sides to see that these steps are completed on time.

## Court May Vary Master McAfee’s Timetable Order

[26] Master McAfee’s timetable order of August 8, 2014 was made on consent. However it was not a consent order which created substantive rights which the court may not vary except in circumstances where the court will set aside a contract. Master McAfee’s order created procedural rights only and expressly provided that it may be varied by a later order.

[27] I will now consider whether the circumstances before me are such that the plaintiffs’ motion to vary Master McAfee’s timetable order should be granted.

[28] The plaintiffs’ notice of motion to vary Master McAfee’s timetable order was dated and filed on August 10, 2015. The plaintiffs’ motion record containing an amended notice of motion returnable November 12, 2015 was served on October 27, 2015. Argument of this motion before me began on November 12, 2015. That being so, this motion should not be dismissed on the ground that this motion was not brought reasonably promptly.

[29] No one would accuse the plaintiffs and their counsel of unseemly haste in the prosecution of this action. However their conduct does not sink to the level of stubborn disobedience of court orders or of the [Rules of Civil Procedure](https://www.ontario.ca/laws/regulation/900194). Plaintiffs’ counsel was aware of the set down deadline in Master McAfee’s order and belatedly tried to meet that deadline without success for reasons I have described. The defendants are partly to blame for that lack of success.

[30] In deciding whether this motion should be dismissed on the ground of delay in the prosecution of it, I should bear in mind the fact that under [rule 48.14 of the Rules of Civil Procedure](https://www.ontario.ca/laws/regulation/900194) the registrar is directed not to dismiss this action for delay prior to January 1, 2017. That date has yet to arrive. I therefore conclude that this motion should not be dismissed on the ground of delay in the prosecution of it. That delay is not inordinate.

## Have Defendants been Prejudiced?

[31] Next I must consider whether, as a result of acts or omissions of the plaintiffs, the defendants have been prejudiced in their ability to defend this action to such a degree that this motion should be dismissed.

[32] In their statement of defence the defendants allege that in September 2010 Ms. Jewell told them that the rent cheques which Kids & Company had provided to Briars Bay Inc. could not be deposited because the Briars Bay bank account had been frozen as a result of claims which Canada Revenue Agency (“C.R.A.”) made against Briars Bay Inc. for unpaid taxes.

[33] The defendants further allege that the assignment of the lease for the Newmarket premises from Briars Bay Inc. to Ms. Jewell and Mr. Kitteringham and the request that in future, all rent should be paid to Ms. Jewell and Mr. Kitteringham (and not to Briars Bay Inc.) was part of a fraudulent conveyance of the lease and a scheme to defeat the claims of C.R.A.

[34] The defendants allege that they decided to vacate the Newmarket leasehold premises because they feared that C.R.A. would lock Kids & Company Ltd. out of those premises.

[35] These allegations are simply that: allegations. There is no affidavit form any of the defendants in which the affiant swears that these allegations are true. There is no evidence that C.R.A. ever gave Kids & Company Ltd. any direction to pay rent to C.R.A. on that C.R.A. brought garnishment proceedings to seize rent payable by Kids & Company Ltd. for the Newmarket premises.

[36] The only defence affidavit delivered in this motion is one by Lorna Groves, an assistant to defence counsel. In her affidavit Ms. Groves relays a concern of defence counsel that owing to the passage of time, documents respecting the alleged seizure of the Briars Bay Inc. bank account may no longer be available. This is speculation.

[37] Mr. Kitteringham has sworn two affidavits in connection with this motion. In the first such affidavit Mr. Kitteringham swears that while there were issues with C.R.A. at the time when the Briars Bay Inc. lease was assigned, Briars Bay Inc. had no liabilities to C.R.A. or to anyone else.

[38] In his second affidavit Mr. Kitteringham says that he and his spouse Ms. Jewell had previously operated a child care business form the same premises which Briars Bay Inc. later leased to Kids & Company Ltd. In his second affidavit Mr. Kitterningham goes on to state that in September 2010 he and Ms. Jewell told Ms. Sopik that there were irregularities with the Briars Bay Inc. bank account which had reference to a dispute with a former business partner in their child care business. Mr. Kitteringham states that he and Ms. Jewell did not advise Ms. Sopik that C.R.A. had frozen the bank account of Briars Bay Inc.

[39] Since Mr. Kitteringham has sworn two affidavits in connection with this motion, defence counsel could have cross-examined him. Defence counsel could have asked Mr. Kitteringham if C.R.A. had indeed frozen the bank account of Briars Bay Inc., and if so what documents were created in connection with that seizure. Defence counsel could have asked Mr. Kitteringham how many of those documents were still available, either directly through Briars Bay Inc. or indirectly through its bank.

[40] This course of action would have taken the subject of missing documents helpful to the defence out of the realm of speculation and into the realm of established fact. This did not happen. Defence counsel never cross-examined Mr. Kitteringham.

[41] In my view, the argument that the defence has been prejudiced because documents helpful to the defence have gone missing owing to the passage of time is nothing more than speculation.

[42] In his second affidavit Mr. Kitteringham says that, based on his own experience in obtaining a license to operate a child care facility, the whole application process takes about six months.

[43] Since it is a matter of public record (namely the extract from the records of the Ontario Ministry of Education respecting Kids & Company Ltd. forming exhibit “B” to Mr. Kitteringham’s October 28, 2015 affidavit) that Kids & Company Ltd. first obtained a license to operate a child care facility at its Aurora location on June 18, 2010 Mr. Kitteringham believes that Kids & Company Ltd. formed the intention to vacate its Newmarket leasehold premises long before September 2010 when the defendants allege that the plaintiffs fraudulently had Briars Bay Inc. assign the lease in question to the plaintiffs themselves and when the defendants allege that Ms. Jewell first told them that C.R.A. had frozen the bank account of Briars Bay Inc.

[44] The timing of events in the evidence before me is such that Kids & Company Ltd. decided to move its operations from Newmarket to Aurora long before Kids & Company Ltd. says it first learned of difficulties between Briars Bay Inc. and C.R.A.

[45] The defence argument that Kids & Company Ltd. decided to move its operations form Newmarket to Aurora in order to avoid becoming involved in a dispute between C.R.A. and Briars Bay Inc. is based upon a fabrication.

[46] In all these circumstances, I have come to the conclusion that this motion should not be dismissed on the ground of prejudice to the defendants.

## Result

[47] For all the above reasons this motion is granted as follows. The timetable order of Master McAfee is varied as follows:

(a) within 15 days the parties are to agree upon a mediator and a date for mediation;
(b) if the parties are unable so to agree, the plaintiffs are forthwith to write the mediation coordinator requesting that a roster mediator be assigned to this action, which mediator will promptly fix a date for the mediation;
(c) within 15 days after the mediator agreed upon or assigned to this action has fixed a date for mediation the plaintiffs are to set this action down for trial; and
(d) within 20 days the defendants are to serve affidavits of documents.

[48] If the defendants fail to comply with clause [47] (d) above, and the plaintiffs wish to bring a sanctions motion, the plaintiffs are hereby given leave to bring that motion after this action has been set down for trial.

## Costs

[49] The plaintiffs were successful on this motion but did not serve any costs outline (Form 57B) as they were required to do by [subrule 57.01(6) of the Rules of Civil Procedure](https://www.ontario.ca/laws/regulation/900194) if they wanted costs. There will therefore be no order as to costs in favour of the plaintiffs. The defendants were not successful on this motion and therefore will not receive the costs of this motion.

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Master Thomas Hawkins
Release Date: August 17, 2016