Superior Court of Justice - Ontario
COURT FILE NO.: 10-CV-414334
Heard: March 4, 2016
RE: Siddiqsons Tin Plate Ltd. v. Adler Steel Limited
BEFORE: Master Joan Haberman
COUNSEL: Chalmers, W. for the moving party Belmont, B. for the responding party
ENDORSEMENT
Master Haberman:
[1] On March 1, 2016, both parties moved for relief before me, in the context of this long outstanding Show Cause hearing.
Why this matter has not yet been decided
[2] By its motion, Adler’s sought to increase the amount of security for costs to be posted by Siddiqsons and they were successful in that regard. My Reasons, released on March 11, 2016, required Siddiqsons to post further security in the amount of $35,400 within 45 days. This deadline was subsequently extended to May 2, 2016.
[3] By their motion, brought at the same time, Siddiqsons sought to strike further affidavit evidence delivered by Adler’s deponent, Lal, dated November 11, 2015. This motion was part of a string of procedural motions initiated by Siddiqsons, for the most part, stemming from their own late delivery of materials for a Show Cause hearing that was to have taken place in January 2015.
[4] At paragraph 57 of my March 2016 Reasons, I made it clear that I would not release a decision for Siddiqsons’ motion unless and until I was advised by plaintiff’s counsel that security had been posted as ordered. In my view, there was no need to deal further with Siddiqsons’ motion unless the action was proceeding to a Show Cause hearing, and whether or not that occurred was contingent on Siddiqsons posting costs as ordered.
[5] Hearing nothing from either counsel about this issue, I assumed the security had not been posted. In an effort to tie up loose ends before my fast-approaching retirement, rather than resting on that assumption, I wrote to both counsel on August 11, 2016, requesting an update.
[6] Mr. Chalmers, plaintiff’s counsel, responded to my assistant at length by e-mail on August 15, 2016. He said that security was posted and that a letter had been sent to me by fax to confirm that on May 12, 2016 at 416-327-5484. Two fax confirmation sheets were appended to his response.
[7] The first confirmation sheet indicates that Mr. Chalmers wrote to me at 416-327-5416 on May 11, 2016. This is close to but not quite my fax number, which is 416-326-5416. He was off by one number, so no doubt, someone made a typographical error. The fax cover sheet for that number clearly shows a failed transmission.
[8] It does not appear that Mr. Chalmers’ staff checked the number or tried to reach me again at the correct number (assuming the first try was a typographical error). Instead, Mr. Chalmers’ office tried to reach me again the following day, but this time they used an entirely different fax number that was completely unrelated to mine, which they advised was taken from an earlier fax from my then staff.
[9] The masters’ incoming fax machine serves all 13 masters who sit on the 6th floor in Toronto and there is a steady flow of incoming items. As a result, it is a busy machine, so using it for outgoing faxes as well interrupts the flow of what is coming in. This can create a back-up of incoming faxes in the system, resulting in our receiving our faxes hours after they have been sent. This is a problem when matters are time sensitive.
[10] As a result, staff often use machines other than the one used for incoming faxes to send faxes. These other machines are not overseen by our staff, and may not even be in our staff’s immediate work area, so if a fax is sent anywhere in this building to one of those numbers, rather than to our designated fax machine on the 6th floor, it is highly unlikely we will ever see it.
[11] In this case, the fax number used is that of the civil motions confirmation office – it is used for incoming faxes from lawyers to confirm their motion activity. That occurs on the 10th floor so the machine is likely up there now, nowhere near the masters on the 6th floor. I assume the machine was down here briefly, but then moved and repurposed. A simple google of that fax number shows what this number is now for.
[12] The fax number used by Mr. Chalmers to send that day is therefore not one our staff uses at this time and one that has never been used officially by this office. It is not a designated fax number for incoming faxes to the masters. There is only one designated fax number for reaching us. The court website clearly shows 416-326-5416 as the one and only number for incoming faxes to the master. That has been our number as long as I have been a master, which is almost 18 years. As this fax was sent elsewhere, I never received it.
[13] Several things strike me as odd about all of this:
The first number used was only one digit off from the correct fax number. Instead of calling my staff, checking the source used for that number or checking the court website to confirm the correct number, Mr. Chalmers opted to use a totally different number that has nothing to do with the masters;
As he books motions before this court which must be confirmed, it is surprising that his staff did not recognise the number they ultimately used as the one used for motion confirmations;
Before using the new number, Mr. Chalmers made no effort to confirm that it was the correct number to use for incoming faxes by phoning staff;
Over the course of the last couple of years, my staff has corresponded frequently with Mr. Chalmers’ office, sometimes by e-mail, sometimes by fax. If there was any concern about whether something was going to reach me, they had many sources from which they could have ascertained the correct fax number;
It is unclear why, after the first failed transmission, Mr. Chalmers did not send my staff an e-mail, something he did frequently, to either convey this information or confirm the fax number; and
When sending his fax on May 12, 2016, Mr. Chalmers’ staff wrote the following on the fax cover sheet:
Please see the attached correspondence from Mr. Chalmers dated May 11, 2016. We attempted to send this via fax yesterday afternoon and it is unclear from the fax transmission result if the letter was in fact received for Master Haberman.
[14] In fact, there was nothing unclear about this at all. It was clear from the transmission sheet that the May 11 fax had not been received. That is presumably why it was sent again – to a different yet also incorrect number. In the circumstances, one would have expected Mr. Chalmers’ office to have followed up by phone on May 12 to alert staff to the fact that they should expect this fax or to confirm that we had, in fact, received it. Further, having not received the order from me over the course of three months, one would have thought Mr. Chalmers would have followed up. He has not been shy about e-mailing my staff up to now. This time, he did nothing.
[15] In the context of a pending Show Cause hearing, this further delay is something that should be considered. It could be inferred that Mr. Chalmers, aware of my retirement (I had mentioned at the last appearance in the context of my concerns about getting this Show Cause done before my departure) deliberately slowed things down to ensure that the Show Cause hearing took place before another master. Mr. Chalmers has repeatedly expressed his views about my handling of this matter, to the point of announcing that he would save money on therapist fees when I advised counsel of my upcoming retirement and the need, therefore, for us to keep this matter moving.
[16] As a result, I have set out the basis of this further delay above in some detail as it is important in the context of what is to come.
Context
[17] By their current motion, Siddiqsons essentially sought 5 substantive grounds of relief. Much of what they initially asked for was overtaken by the passage of time. At this point, it seems all they want is the relief sought at their item 5 – but not to adjourn, as sought in the notice of motion. Instead, they now seek an order striking the last Lal affidavit.
[18] A brief history is in order. A Status Notice was issued by the court on May 21, 2013 – well over three years ago. The plaintiff requested a Status Hearing on August 26, 2013 and one was convened for December 5, 2013. That was my first contact with this matter.
[19] Counsel for both parties appeared at that time and Mr. Belmont for Adler asked that a Show Cause hearing to be convened. It took some time for that to be arranged as I had no available dates for that event type so we had to wait for new dates to be released. This was followed by a breakdown in communications between counsel and my staff, as well as a failure by counsel to follow up. Finally, on September 30, 2014 the parties agreed that the Show Cause hearing would proceed on January 21, 2015.
[20] This scheduled date was more than a year after the first appearance at Status Hearing Court and almost 4 months past the date on which it was scheduled. Counsel, therefore, had a significant amount of time to prepare their material for this event so there was no obvious impediment that might derail that hearing date. Out of an abundance of caution, my order setting out the hearing date made it clear I was to be advised immediately if anything occurred to jeopardize that date.
[21] As this was a Show Cause hearing, it is clear from case law that the plaintiff has the burden of proof. Therefore, it is up to them to deliver their materials first. In the normal course, the defendant responds and the plaintiff has a right of reply. Though the defendant’s conduct is relevant when the court reviews delay as it is part of the contextual analysis, I have been taken to no case law that suggests this is not the format when there is a counterclaim.
[22] Both parties had delivered some materials at the initial Status Hearing, but it was clear to me that both of them would be providing further and more in depth materials for the Show Cause hearing, and that is what occurred. The problem arose as a result of the timing in which those materials were delivered.
[23] I heard nothing from either counsel until January 15, 2015, when Mr. Chalmers wrote, without leave or consent, to complain about having only received Mr. Belmont’s materials that day. As a result, he wanted to either have those materials excluded or to have the hearing adjourned.
[24] What Mr. Chalmers neglected to mention at the time was that his own record was only served the day prior – on January 14, 2015, and no factum was included in his materials. This was not even 7 clear days before the Show Cause hearing. For the most part, the procedural motions and the delay that has occurred since then arises from this issue.
[25] For the next two weeks my staff was bombarded by e-mails and I was inundated with faxes about this issue and the aftermath. While this battle was being fought, a new one broke out and security for costs were sought from Siddiqsons and awarded. Thereafter, not even the form of order could be agreed to.
[26] When the dust settled, we were left with a new date of April 14, 2015 for dealing with the various evidentiary issues in play arising in the context of the not yet rescheduled Show Cause hearing.
[27] The purpose of Status Hearing Court is to examine delay, as defined by the Rules, to assess if it is justified in the circumstances of each case. Most cases that come before that court are resolved by consent timetable.
[28] However, that is not always the case. In some cases, a defendant takes issue with the delay and puts the plaintiff to “Show Cause”, to explain why the action should be permitted to proceed in the face of this delay. These hearings must be taken seriously by counsel. There is a ream of case law to be reviewed and a good factual record must be put before the court to assist in what the Court of Appeal has told us must be a contextual analysis. If the presiding master is not satisfied with the plaintiff’s record, the action can be dismissed. This has happened from time to time.
[29] Despite the contextual approach, the two central issues in every Show Cause hearing are delay and prejudice. The court looks for an acceptable explanation for the delay and examines who caused what aspect of it. The court also looks at whether the delay resulted in prejudice of such a nature as to make it difficult for a defendant to now obtain a fair trial. At a minimum, we expect both elements to be addressed. As delay is such an important factor in the analysis, delaying a Show Cause hearing exacerbates matters.
[30] I had a further concern about these delays. As a result of amendments to the Rules, particularly Rule 48.14, no Status Hearing courts have been included in the masters’ schedules for over a year – the April 2015 date was virtually the last date in my calendar to be used for that purpose. At the present time, no masters have days in their schedules to conduct these kind of hearings.
[31] Despite all of the foregoing, there were further evidentiary problems at the April 2015 hearing. Mr. Chalmers appeared on his assistant’s affidavit, in which she quoted heavily from what she had been told about the matter by him, some of which was contentious. The purpose of the hearing at this time was to determine if the hearing, which had now been adjourned, should be further adjourned to allow the plaintiff to file the evidence of their CEO, Nacem Ul Hasnain regarding prejudice, and to cross-examine Adler’s deponent, Lal.
[32] The explanation for the obvious gap in Siddiqson’s evidence was explained as follows by their counsel: my client’s position was that if they were not responsible for the delay they can’t be called upon to address the question of prejudice arising from the delay. As Lal’s affidavit suggested otherwise, Siddiqsons now wanted an opportunity to address the issue of prejudice.
[33] As noted above, it is trite law at this point that there are two major issues the court deals with at every Show Cause hearing: delay and prejudice. If the plaintiff is of the view that there is no prejudice, it is for them to say so and to say why. If it is their view that there was no delay or that the delay was caused or contributed to by the defendant, again, it is for them to say so and to say how. If the plaintiff is of the view that they are not responsible for any of the delay so can’t be held accountable for any prejudice that, too is what they should say. In this case, the plaintiff appears to have simply ignored the issue of prejudice as they believed, having not caused it, they did not have to comment on it.
[34] The plaintiff’s argument is, in my view, a weak one, as they will have the burden of proof on what is effectively their Show Cause hearing. To the extent that they could have anticipated any prejudice, it should have been addressed, regardless of whom, in their view, caused it. To the extent that their belief is that they are not responsible for this delay, they could have relied on a “they are the authors of their own misfortune” argument.
[35] Further, having served their record so late in the day, they left themselves virtually no opportunity to deal with the unexpected, save to seek an adjournment. There is no reason I can ascertain for why this should have happened more than a year after the first appearance in Status Hearing court and none has been provided by the plaintiff.
[36] In the context of the adjournment request to allow the plaintiff to deliver responding material, Ul Hasnain assured the court that if permitted to file this evidence now he would come to Canada from Pakistan to be cross examined if requested. Having examined the issues thoroughly, I concluded that as it was not clear whether counsel or client was responsible for the delayed delivery of the plaintiff’s Show Cause record. In view of the ramifications of excluding further evidence, I was prepared to allow Siddiqsons to respond. As I stated at that time:
In that the life of an action hangs in the balance, I am prepared to give the plaintiff the benefit of the doubt.
[37] I therefore ordered that the plaintiff could deliver reply materials, but no later than August 14, 2015 and restricted to the issue of prejudice. Further, I allowed cross-examination of Lal, to be completed by the end of September 2015, also restricted to the issue of prejudice. Similarly, Adler was given leave to cross-examine Ul Hasnain on that issue.
[38] Matters did not go as planned as Ul Hasnain, having delivered his affidavit, and then had difficulty getting a visa granting him entry to Canada. As a result, counsel agreed to adjourn both cross-examinations to November 24, 2015. The plaintiff sought and was granted an extension of that deadline to November 30, 2015.
[39] That brings us to the current motion before me. In order to put that in context, I must return to the April 2015 hearing.
[40] I released my Reasons on that motion on June 26, 2015. Having agreed that Ul Hasnain could cross-examine Lal and respond, in both cases on the issue of prejudice, only, I included in my order the requirement that this cross-examination be completed by the end of September 2015. If Adler decided to cross-examine Ul Hasnain, that was to be completed in the same time frame.
[41] Because of the visa issues, the deadline for cross-examination was extended, on September 28, 2015, at counsels’ request of that day to November 30, 2015. On November 11, 2015, Lal swore a 27-page affidavit addressing prejudice, served the following day.
[42] In the end, Siddiqsons addressed the original Lal evidence by way of an affidavit sworn by Brian Chung, not Ul Hasnain. Chung is an associate lawyer at the firm at which Mr. Chalmers practices. His affidavit addressing the issue of prejudice for the Show Cause hearing was served on August 14, 2015.
[43] Siddiqsons’ current complaint is that Adler had no right to submit further materials as this was not provided for in the timetable. They also state that Adler waited too long to address the issue, as Lal’s new affidavit was served on November 12, 2015 for cross-examinations scheduled for November 24, 2015.
[44] As a result of Siddiqsons’ take on what my June 2015 order meant, the cross- examinations did not take place in November 2015, nor, as far as I am aware, have they taken place. In view of the delay in alerting me to the fact that they had posted security as ordered, the action has now moved nowhere for a further ten months.
[45] Mr. Chalmers’ submission was to the effect that his motion would turn on my view of what my June 2015 order meant. His view was that, having not expressly provided for further material from Adler, none could be delivered without leave.
[46] I do not accept that interpretation. Siddiqsons has controlled the pace of these proceedings since January 2015. They decided to hold off filing their record for the Show Cause hearing until January 14, 2015 for a hearing scheduled for January 21, 2015 and even then, they filed no factum. This is why this matter went off the rails in the first place.
[47] Adler, in response, did not write to me to seek an adjournment at the time, which they would have been within their rights to do. Instead, they served their responding materials the very next day. They were therefore ready to proceed with the hearing as scheduled. It was Siddisqons, however, who then raised late service! I remain puzzled at how they could make such an assertion in view of their timing. As Mr. Belmont noted, it is sheer chutzpah for Siddiqsons to now complain about late materials.
[48] My order of June 26, 2015 was not intended to contain a full timetable. It was intended only to get matters back on track, to allow Siddiqsons to do what they ought to have done at the outset and address the issue of prejudice. My Reasons said nothing about neither party being able to serve further materials. This result was, in my view, an indulgence granted to Siddiqsons, such that their current position is hard to understand. How many indulgences can one party expect?
[49] It was Siddisqsons that threw off the normal order of things. Had they addressed both delay and prejudice in their record, then both issues would have been addressed fully, in the context of their responding evidence, by Adler. Siddiqsons would then have had an opportunity to reply to both issues, thereby having the final word.
[50] But that is not what they did. In what now appears to me have been a strategic approach, Siddiqsons waited until very late in the day to show their hand regarding the Show Cause and their hand held only “delay” cards. They decided they needn’t address prejudice at all, as their view is that they did not cause the delay.
[51] While, at the end of the day, they may be right in that regard, this was a risky strategy to adopt, as it is ultimately a court’s view, not theirs, that will prevail. If any of the delay is found to have been attributable to their conduct, there may well be a case for them to answer. I hasten to add that I have refrained from looking at the Show Cause materials in any depth so I have not formed any views as to the merits of the arguments.
[52] After having seen Adler’s evidence in January 2015, Siddiqsons should have sought an adjournment, explaining when both parties served their materials and how they now came to be in this predicament. Their approach should have been a tempered one, as they were clearly seeking the court’s indulgence, having waited so long to serve their materials, a delay which has never been explained.
[53] Instead, their strategy was an unusual one. They decided to come on like blockbusters, making an issue of the timing of Adler’s materials, without saying anything about the fact that theirs had only been served a day earlier and that they had yet to serve a factum.
[54] This motion is, in my view, more of the same. In view of how Siddiqsons approached the issue of prejudice, Adler “went first” with that issue, instead of them. As a result, the Chung affidavit became responding, not reply, evidence with respect to the issue of prejudice. Accordingly, Adler is entitled to reply and the Lal affidavit shall therefore stand.
[55] Siddiqsons motion is dismissed.
[56] Cross-examinations shall be completed by the end of January 2017. As I will have retired by then, counsel will have to write to the team leader to have this Show Cause reassigned. I suggest they get on with it. A copy of this order shall be included with that request.
[57] One of the things that will have to be explained when the matter does get to a Show Cause is why it was Chung who ultimately swore the affidavit for that event rather than Ul Hasnain,, though it was the latter who featured in Siddiqsons’ April 2015 motion material. It was also his difficulties getting an entry visa that led to extended dates for cross-examination. The fact that, in the end, there is no evidence from him in Siddiqsons’ record will therefore have to be explained.
[58] If the parties are unable to agree as to the costs of this hearing, I can be spoken to within thirty days.
_(original signed) _
Master Joan M. Haberman
Released September 16, 2016