Court File and Parties
COURT FILE NO.: CV-11-424824 DATE: 2016-10-13 SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Elom Benjamin Dzuazah, Plaintiff/Respondent on Appeal AND: Regional Municipality of Peel Police Services Board; Mike Metcalf Chief of Police; CST Michael Viozzi, Badge #1897; Det. David Van Ellen, Badge #1059; Constable Scott Hogan, Badge #2085; Adult Entertainment Association of Canada; Cannonball Cabaret; Diamonds; Kennedy’s; Locomotion (The New); Matheson’s; Million Dollar Restaurant; D. Altantic Inc., carrying on business as Treasures; 1094388 carrying on business as Pure Gold, Defendants/Appellants
BEFORE: S. F. Dunphy, J.
COUNSEL: Eugene Mazucca, for the Defendants/Appellants Peel Police Services Board, Metcalf, Viozzi, Van Allen and Hogan Sam Sasso, for the Plaintiff/Respondent on Appeal
HEARD: 29 September, 2016
Endorsement
[1] This appeal from the decision of Master Pope (reported at 2016 ONSC 4714) raises the narrow question of whether a defendant who files some evidence of prejudice on a motion to set aside a registrar’s order dismissing an action for delay thereby acquires the onus of establishing the existence of prejudice that absent such evidence would lie squarely upon the plaintiff’s shoulders. The appellant takes the position that Master Pope effectively reversed the onus that lies with the plaintiff to establish the lack of prejudice when she found the defendant’s evidence of one element of alleged prejudice to be insufficient.
[2] For the reasons that follow, I am allowing this appeal and restoring the registrar’s order dismissing this action for delay. The Master’s decision erred in two ways. Her decision failed properly to apply the onus upon the plaintiff to satisfy the court that there was no prejudice to the defendants. The Master found that the plaintiff’s evidence satisfied none of the criteria in the case law for setting aside a registrar’s dismissal order. The mere fact that the defendant’s evidence of actual prejudice in one discrete area was rejected does not alter the fact that there was virtually no evidence to establish that no prejudice existed in other areas and the plaintiff therefore failed to discharge his primary burden. Secondly, the Master’s decision failed to give adequate weight to the principle of finality. A contextual approach to the question of reviewing a registrar’s dismissal order requires a balanced and principled weighing of all of the relevant factors.
Overview of facts
[3] No party has alleged palpable or overriding error on the part of the Master in her appreciation of the facts.
[4] The plaintiff was arrested in 2009 with respect to human trafficking and prostitution related charges. Those charges were withdrawn or dismissed in 2010. In January 2011, two Peel police officers met with 31 other people, 22 of whom were from the adult entertainment industry. It is alleged that the plaintiff and others were described in the meeting as “notorious pimps” and that mug shots of a number of people including the plaintiff were circulated.
[5] Details of the meeting and the mug shot of the plaintiff found their way into the media’s hands by unknown means with resulting publicity which the plaintiff claims harmed him.
[6] This action was commenced shortly after that meeting (in April 2011) naming the Police defendants, the Adult Entertainment Association of Canada and eight adult entertainment establishments.
[7] The statement of claim alleges negligence, malicious prosecution, abuse of process, breach of Charter rights, injurious falsehood, defamation and intentional infliction of nervous shock and mental distress. Among the issues in the litigation are the circumstances surrounding the original complaint and charges against the plaintiff and the means by which the contents of the January 2011 meeting came to be known and published by the media. The Police defendants deny responsibility. No court has made a determination on the issue.
[8] Statements of defence of the Adult Entertainment Association of Canada and the Police defendants were delivered in July 2011. Particulars demanded by the Police defendants were delivered shortly thereafter in August 2011.
[9] No further steps in the proceeding have been taken since that time as regards the claim against the appellants (i.e. the Police defendants).
[10] Mr. Pieters initially represented the plaintiff as counsel in bringing the claim. It appears that he was intending on taking a sabbatical shortly after commencing the claim. After a brief period in which the plaintiff was self-represented, the file was handed over to Ms. Claxton who advised the parties of her retainer on October 11, 2011 although her formal Notice of Change of Lawyers was not delivered until later (February 23, 2012). The claim was discontinued against seven of the eight adult entertainment establishments in this time frame (the claim against the eighth was not discontinued due to the fact the business had ceased operating).
[11] Following the delivery of the Notices of Discontinuance and Ms. Claxton’s formal Notice of Change of Lawyers on February 23, 2012, progress on this litigation file appears to have come to a full and complete stop. Attempts by counsel for the Police defendants to obtain information about the reasons for the discontinuance of the claim as against the various co-defendants in March 2012 or to discover whether the plaintiff intended to continue with the action as against the Police defendants in April 2013 were not responded to.
[12] The registrar issued a status notice on May 13, 2013. The 90 day time frame to respond to the status notice expired on or about August 14, 2013.
[13] The plaintiff wrote to Ms. Claxton on June 27, 2013 indicating his concern about the lack of progress on the action and requesting a status report by July 8, 2013. At some point in this time frame Mr. Pieters appears to have returned from sabbatical and become re-involved behind the scenes in some fashion. He checked the court file and discovered the status notice. He wrote to Ms. Claxton on August 16, 2013 following up on a call with her on the previous day noting Mr. Dzuazah’s recent unsuccessful attempt at being updated.
[14] Ms. Claxton wrote to counsel for the Police defendants that same day (August 6, 2013) acknowledging the status notice that she thought was due to expire on August 21, 2013 and indicating she intended to schedule a motion to set a timetable. A telephone call to discuss that proposed motion was held on August 19, 2013. Importantly, Ms. Claxton was again asked about the plaintiff’s intentions to proceed with the action and promised to follow up after meeting with her client. Ms. Claxton did not in fact follow up with the Police defendants.
[15] At this time, Ms. Claxton filed a requisition for a one hour motion (apparently requesting dates previously cleared with Mr. Reimer), receiving a tentative date of February 7, 2014. She did not confirm that date with Mr. Reimer although he later managed to find out about the date from his own court search.
[16] The plaintiff wrote to Ms. Claxton about the lack of action on his file on November 19, 2013. The email included an indication that his next step would be a complaint to the Law Society.
[17] Still more silence and inaction followed.
[18] On January 16, 2014, the registrar issued an order dismissing the action for delay.
[19] Meanwhile, no steps were taken to deliver materials for the February 7, 2014 motion date that had earlier been requisitioned by Ms. Claxton or even to broach the topic of a timetable with defendants’ counsel.
[20] On January 29, 2014 the plaintiff sent a further email to Ms. Claxton. It referenced a meeting that had been held with her on January 22, 2014. He inquired about the February 7, 2014 motion, asking “what the hearing…pertains to?” He also asked “if you as my lawyer have received any notice to dismiss the action”. This email was copied to Mr. Pieters whose prior involvement in the matter of the status notice I have mentioned earlier. An immediate reply was requested.
[21] Ms. Claxton held a short call with Mr. Reimer on January 31, 2014. During this call, Mr. Reimer discussed the dismissal order with Ms. Claxton. There is some suggestion that she may not have seen the dismissal order before that call. She hinted at a settlement proposal that would be coming and left him with the impression that a confirming letter would follow the next day. No such letter arrived.
[22] The phone call of January 31, 2014 was the last contact of any kind that the Police defendants had from or on behalf of the plaintiff until November 16, 2015 when Mr. Sasso (special counsel for the plaintiff on this motion) contacted Mr. Reimer by letter to schedule a motion to set aside the registrar’s dismissal order. In the intervening 21 months, Mr. Reimer closed his file. The February 7 motion originally reserved by Ms. Claxton in August 2013 was not confirmed and did not take place. No settlement proposals were sent and no negotiations held.
[23] There was a little more activity between Ms. Claxton and her client than was apparent to counsel for the Police defendants, although not much more. Needless to say, the Police defendants had no way of knowing what communications were passing between the plaintiff and his own lawyer whether before or after the registrar’s dismissal order.
[24] On January 31, 2014 Ms. Claxton wrote to her client about discussions with counsel for the Police defendants. She advised Mr. Dzuazah “of potential resolution discussions”, reporting the defendants “amenable to same”. She mentioned that the timetable motion scheduled for February 7, 2014 would be rescheduled “to a time after the settlement discussions take place”. Mr. Dzuazah was requested to put together his documents “as discussed” given the likelihood of a settlement meeting or conference being held soon.
[25] Ms. Claxton’s email to her client did not answer Mr. Dzuazah’s question about whether she had received a notice to dismiss the action nor did it advert to the fact that Mr. Reimer had discussed that dismissal order with her in his brief telephone call earlier that day. While Ms. Claxton’s failure to mention this rather important fact remains unexplained (she was not called as a witness), there is similarly no explanation for Mr. Dzuazah’s lack of follow-up on a question that he was clearly worried about raised in a letter that he copied to his former lawyer whose continuing behind-the-scenes involvement since at least August 2013 is evident and was specifically remarked upon by the Master.
[26] Mr. Dzuazah wrote to his counsel on two further occasions – September 11, 2014 and January 7, 2015 – each time failing to receive a response. The letters do not suggest that Mr. Dzuazah was satisfied by the non-responses received. To the contrary, his dissatisfaction was quite evident and is confirmed by the fact that he began looking for new counsel. In April 2015, Mr. Dzuazah met with one possible new counsel. It is at this time that he claims he first discovered the existence of the registrar’s dismissal order from the prior year.
[27] Mr. Sasso appeared on the motion as agent for Ms. Claxton who remained – at least until Mr. Pieters went back on the record in September 2016 – the plaintiff’s counsel of record. The plaintiff’s notice of motion confirms Mr. Sasso’s role is by agreement with LawPro. The timing of Mr. Sasso’s retainer or the agreement between the plaintiff and LawPro is not before me.
[28] In response to the plaintiff’s motion, Mr. Reimer as counsel for the Police defendants filed a short affidavit. His affidavit discussed the chronology of events related above to the limited extent known by him. He noted the lack of any affidavit of documents from any party and the lack of any request for one from him. He noted that he had assumed the plaintiff had abandoned his action and closed his file. One of the concluding paragraphs of this affidavit relates to the question of prejudice and is set forth below:
“38. Since re-opening my file after the communication from Mr. Sasso, I have learned that the two police officers involved in the meeting of January 2011 have retired (as have the defendant police chief and another involved officer).
Overview of Master’s Decision
[29] In considering the plaintiff’s motion to set aside the Registrar’s dismissal order, Master Pope concluded that the plaintiff had the onus to satisfy the court that the action should be permitted to proceed and found that she should consider the four “Reid factors” taken from Reid v. Dow Corning Corp., (2001) 11 C.P.C. (5th) 80 (Ont. Master), rev’d on other grounds at 48 C.P.C. (5th) 93 (Div. Ct.). The four Reid factors are (i) explanation of the litigation delay; (ii) inadvertence in missing the deadline; (iii) promptness in bringing the motion to set aside; and (iv) lack of prejudice to the defendants.
[30] The Master reviewed the Reid factors as these have been commented upon in a number of subsequent cases including Finlay v. Van Paasen, 2010 ONCA 204, Wellwood v. Ontario Provincial Police, 2010 ONCA 386 and Habib v. Mucaj 2012 ONCA 880, [2012] O.J. No. 5946 (C.A.) and as summarized by Master Dash in Ross v. Hertz Canada, 2013 ONSC 1797. She concluded that all four Reid factors need not be satisfied in every case. A contextual approach is called for. While all factors are important and to be weighed, prejudice is the key consideration.
[31] The Master proceeded to review each of the four Reid factors. In relation to the first (explanation for the delay), she concluded that “there is no explanation whatsoever for the delay during this period and the failure to take any steps to advance this action to trial. Furthermore the plaintiff has not explained the reason why no steps were taken” (para. 49).
[32] Her analysis of the evidence in relation to the second (inadvertence) factor led to the conclusion (at para. 54) that “Ms. Claxton’s conduct was on the opposite end of the continuum from conduct that could be considered to be a mere slip, while not deliberate, [it] was egregious”.
[33] In relation to the third factor (promptness in bringing the motion), the Master found that while it was clear that “the plaintiff and Mr. Pieters were communicating throughout this action” (at para. 60), she was “not persuaded that the plaintiff had actual knowledge that the dismissal order had been issued until late April 2015” (para. 61). In so finding, she accepted that while “there is some evidence that suggests he may have known of the dismissal order earlier, it is not conclusive”. She therefore found that Mr. Dzuazah learned of the dismissal order in late April 2015 (at para. 63). It is however not disputed that Mr. Dzuazah’s lawyer (Ms. Claxton) learned of it no later than January 31, 2014 when she spoke to Mr. Reimer.
[34] However, even with this favourable finding, the Master noted that the plaintiff had offered no satisfactory evidence to explain the almost seven month’s delay between late April 2015 and Mr. Sasso’s initial contact in mid-November 2015. She accordingly found (at para. 65) that the plaintiff had not acted promptly to set aside the dismissal order [1].
[35] As regards the fourth Reid factor (prejudice), the Master found that “the plaintiff has failed to meet his onus to demonstrate that the Police defendants would not be deprived of a fair trial if the action were reinstated” (at para. 70). Nevertheless she found that “the Police defendants have not demonstrated that they will suffer prejudice if the action is reinstated” (at para. 73). It is this latter conclusion, and the reasoning that led her to it, that lies at the heart of this appeal.
Issues to be decided
[36] There is no dispute between the parties as to the standard of review on this appeal of an order made under Rule 37.14 of the Rules of Civil Procedure. The decision of the Master is discretionary and entitled to deference on appeal. The decision may be set aside if the Master proceeded on an erroneous legal principle or made a palpable and overriding error with respect to the facts. Reversal of discretion may also be appropriate where the Master gave no or insufficient weight to relevant considerations: H.B. Fuller Company v. Rogers (Rogers Law Office), 2015 ONCA 173 at para. 20. On questions of law, the correctness standard applies: Wellwood, at para. 28.
[37] The appellants allege no palpable and overriding error in the findings of fact made by the Master. The appellants contend that the Master proceeded from an erroneous legal foundation and failed to give adequate weight to relevant factors.
[38] The Appellants have raised the following issues on this appeal:
a. Did the Master err in law in concluding there was no actual prejudice despite finding the plaintiff had not discharged his onus of demonstrating lack of prejudice? b. Did the Master err in law in failing to give adequate weight to the concept of finality? c. Did the Master err in giving retrospective effect to Rule 48.14 of the Rules of Civil Procedure?
Discussion and analysis
[39] The inaction on this file has been profound and inexcusable. More accurately, no excuse having been offered by the plaintiff, the delay remains entirely unexplained. Three periods of unexplained delay may be identified: the delay between the status notice on May 13, 2013 and the dismissal order on January 16, 2014; the delay from the dismissal order until late April 2015 (when Mr. Dzuazah received confirmation that a dismissal order had in fact been issued); and the delay from late April 2015 until November 16, 2015 when Mr. Sasso wrote to counsel for the Police defendants. Each of these periods of delay remains entirely without satisfactory explanation for the lack of progress in the action, the failure to settle a timetable or the failure to bring a motion to set aside the dismissal order (as the case may be). Was the Master correct in law in finding that the dismissal order ought nevertheless to have been set aside?
(a) Did the Master err in law in concluding there was no actual prejudice despite finding the plaintiff had not discharged his onus of demonstrating lack of prejudice?
[40] As noted above, the Master found that the plaintiff had failed to satisfy any of the first three of the Reid criteria. The nub of the issue on this appeal concerns her treatment of the fourth criterion: prejudice to the defendant. I shall therefore examine the analysis of this issue in her decision to determine whether it evidences any errors of law warranting reversal.
[41] The appellants took no issue with the Master’s summary of the applicable legal principles:
“68. Where the presumption arises, the plaintiff bears the burden of rebutting the presumption, on proper evidence. Where the presumption is so displaced, the onus shifts to the defendant to establish actual prejudice. The plaintiff can overcome the presumption by leading evidence that all relevant documents have been preserved, that key witnesses are available or that certain aspects of the claim are not in issue. (Wellwood v. Ontario Provincial Police, 2010 ONCA 386, at paras. 60, 62)”
[42] The Master next found (at para. 69-70) that the plaintiff had led no evidence to show that the Police defendants will not be prejudiced if the action is reinstated and that “the plaintiff has failed to meet his onus to demonstrate that the Police defendants would not be deprived of a fair trial if the action were reinstated”.
[43] Having reached the conclusion that the plaintiff had failed to discharge his onus of meeting the fourth Reid criterion as well, the Master found (at para. 71) that “[d]espite this finding , I am required to consider the Police defendants’ evidence on the issue of prejudice” (emphasis added).
[44] While I can find no fault in the Master considering all of the evidence properly before her, the source of that evidence cannot operate to shift the burden of proof that remains with the plaintiff. Her conclusion that she was “required” to review the evidence of the Police defendants on the subject of prejudice led directly to her conclusion at paragraph 74 that based upon that evidence that “there will be no prejudice to the Police defendants”. This latter conclusion amounted to a reversal of the onus of proof and was in error.
[45] The Master’s conclusion that a single instance of potential prejudice was insufficient could not fairly or reasonably be extrapolated into a finding that no other prejudice exists in the absence of evidence.
[46] The onus to establish lack of prejudice belonged to the plaintiff seeking to set aside the registrar’s order. Prejudice is assumed after the passage of a limitation period and it will also be presumed that memories of witnesses fade over time: Wellwood, para. 62.
[47] In most cases, positive evidence of the plaintiff will be required to displace the onus. Such evidence may seek to establish that documents have been preserved, that witnesses have been identified and remain available: Wellwood at para. 62. Further, “where there is a presumption of prejudice, the defendant need not lead actual evidence of prejudice and the action will be dismissed for delay unless the plaintiff rebuts the assumption”: Wellwood at para. 71. While the plaintiff discharging his onus of demonstrating lack of prejudice is not required to speculate as to which witnesses will be called by defendants who have yet to conduct an examination for discovery, the plaintiff nevertheless has an obligation to deal with the areas of likely prejudice that can readily be discerned from a review of the pleadings and to address why no prejudice is likely to exist on the facts of this case.
[48] In exceptional cases, positive evidence of the plaintiff to rebut the presumption of prejudice will not be required but can instead be gleaned from the surrounding circumstances. In MDM Plastics Limited v. Vincor International Inc., 2015 ONCA 28 counsel for the defendant had consented to an order setting aside a dismissal order. The motion to set aside the subsequent dismissal order was promptly brought. The Court of Appeal found that the plaintiff need not necessarily rebut the presumption with affirmative evidence but that “in evaluating the presumption of prejudice, the master or motion judge must consider all of the circumstances, including the defendant’s conduct in the litigation” (at para. 32). The prior consent of the defendant to setting aside the first dismissal order in MDM could reasonably be taken as an assertion that no material prejudice had been occasioned by the delay.
[49] In this case, there is no suggestion that the defendants’ conduct has contributed to the delay in any fashion or justifies (as was the case in MDM) the inference that the defendants’ will suffer no prejudice from the reinstatement of the case.
[50] The finding in MDM does not justify a conclusion that the presumption of prejudice no longer applies. It merely represents an instance where affirmative evidence to rebut the presumption was able to be found from the conduct of the defendant without the necessity of additional positive evidence.
[51] The Master’s finding that the plaintiff had failed to discharge his onus of demonstrating that the defendants would not be prejudiced by the reinstatement of this case was amply supported by the facts. Among these are:
a. Documents: There is no evidence that the plaintiff has taken any steps to identify, let alone secure, relevant documents. No affidavits of documents had been exchanged and there is no evidence that the plaintiff ever gathered the documents he had been requested to locate by his counsel in January 2014. b. Witnesses: There is no evidence that all or even most relevant witnesses have been identified, still less that their recollections have been recorded or safeguarded in some way. The complainant whose evidence led to the allegedly malicious prosecution is clearly someone with relevant information. The January 2011 meeting was attended by 31 people – the plaintiff having discontinued the action as against all of the adult entertainment employers originally named, access to some or all of these third-party witnesses may well have been lost or rendered more difficult. There is no evidence here, as there was in Habib v. Mucaj (at para. 10) that “the key independent witness was still available and had a clear recollection”. There is simply no evidence as to the quality of the memory of any witnesses in this case or the availability of any of the third-party witnesses. The relative importance of third party witnesses to the facts pleaded in this case makes it impossible to reach conclusions about the existence of prejudice without more information about the efforts made to preserve the evidence of these individuals who are no longer directly connected to the action. c. Status of Proceedings: The action has not proceeded beyond pleadings. There have been no documents exchanged. No examinations for discovery have been held. No motions have been conducted where affidavits recording some or all of the major events might have been exchanged or subjected to cross-examination. This action remains at as preliminary a stage as can be imagined. Indeed, so slight has been the progress, the defendants have been left to inquire – without response - as to whether the plaintiff intended seriously to pursue the claim. There is no basis to infer that more than an initial investigation of the claim has been conducted by any party. In 1196158 Ontario Inc. v. 6274013 Canada Inc., 2012 ONCA 544, 112 O.R. (3d) 67, Sharpe J.A. put it this way (at para. 27): “[a]t the very least, without some action on the part of the plaintiff, the defendants would be disinclined to spend any time or money in preparing affidavits of documents or taking any other steps in anticipation of a trial that, as time went by, became increasingly unlikely to happen”.
[52] The evidence of unanswered attempts to inquire into the basis for releasing co-defendants from the action and the inability of the Police defendants to get a clear answer to the question of whether the plaintiff was seriously intending to pursue the claim against the remaining defendants justifies the inference that the defendants’ investigation had no reason to move very far past the level required to be able to plead a defence to the claim by the time of the registrar’s dismissal order was issued. Answers to these queries might have led to efforts to identify and secure the evidence of some or all of the attendees at the meeting.
[53] The point of this is not to speculate about what prejudice might actually be attributable to the delay. Rather, it underscores the good common sense inherent in the application of the presumption of delay in the first place. While a plaintiff cannot necessarily speculate as to every relevant witnesses other parties may choose to call, the nature of this case combined with the lack of virtually any forward progress after pleadings placed an onus upon the plaintiff to explain why it would be fair to proceed to trial without any information as to whether some or all of the evidence that is clearly material to the claim has been lost or degraded significantly. The whole point of the presumption of prejudice in these circumstances is that it is more likely than not that irreversible prejudice has occurred. That common sense conclusion is all the more applicable where the evidence of so many third parties is obviously implicated by the allegations contained in the pleadings.
[54] The plaintiff submitted that the burden of proof should be seen as having shifted in this case by reason of the defendants having filed some evidence of prejudice in response to this motion. The plaintiff was unable to point to any authority for that proposition and the logic of applying such an analysis to the present case appears to me to be quite thin.
[55] The maxim “expressio unius est exclusio alterius” may have application to questions that may be reasonably be supposed to lie within the privileged knowledge of a party. Having ventured to comment on a single aspect of prejudice, the Police defendants cannot reasonably be taken to have impliedly asserted that no other prejudice exists. The Police defendants cannot be supposed to have unique or superior knowledge of the availability of the plaintiff’s own documents or the availability and state of memory of dozens of third-party witnesses to the January 2011 meeting or to criminal charges against the plaintiff that were disposed of six years or more in the past. The identity – or means of identifying - the source of the leaks to the media of the events of the January 2011 meeting remains in dispute and cannot be presumed at this point to lie solely within the Police defendants’ control.
[56] There was simply no evidence from which it could reasonably have been inferred that the defendants would suffer no prejudice simply because a single instance of alleged prejudice proved unconvincing. The Master ought to have applied the presumption of prejudice in favour of the Appellants and required either affirmative evidence of the plaintiff as to the lack of prejudice or demonstration of exceptional circumstances as occurred in MDM.
(b) Did the Master err in law in failing to give adequate weight to the concept of finality?
[57] The Appellants also submit that the Master failed to give adequate weight to their entitlement to rely upon the finality of the Registrar’s dismissal order.
[58] The Court of Appeal in Wellwood and 1196158 Ontario Inc. strongly emphasized the importance of the principle of finality, an emphasis re-affirmed in MDM. The following quotations from relevant Court of Appeal judgments appear to me aptly to summarize the principles to be applied:
a. “[t]he absence of actual prejudice does not automatically or inevitably trump the values of timeliness and efficiency. At some point, a party who has failed to respect the rules designed to ensure timely and efficient justice loses the right to have its dispute decided on the merits”: 1196158 Ontario Inc. at para. 33; b. “The test is conjunctive, not disjunctive. Even if the plaintiff can provide satisfactory evidence for the delay, the action will be dismissed if there would be prejudice to the defendant. And if the plaintiff is not able to provide a satisfactory explanation for the delay, it is still open to the judge to dismiss the action, even if there is no proof of actual prejudice to the defendant”: 1196158 Ontario Inc. at para. 32; c. “Fairness requires allowing parties to plan their lives on the assumption that, barring exceptional or unusual circumstances, litigation timelines will be enforced”: 1196158 Ontario Inc. at para. 44; d. “When an action has been disposed of in favour of a party, that party’s entitlement to rely on the finality principle grows stronger as the years pass. Even when the order dismissing the action was made for delay or default and not on the merits, and even when the party relying on the order could still defend itself despite the delay”: Marché D'Alimentation Denis Thériault Ltée v. Giant Tiger Stores Limited, 2007 ONCA 695 at para. 38; and e. “The solicitor’s behavior resulted in an excessive delay. Delays of this kind are inimical to the important goal of timely justice. The legal system should not condone the solicitor’s behaviour as to do so would fail to provide appropriate incentives to those engaged in the justice system and would risk harming the integrity and repute of the administration of justice. Reinstating the action at this point would undermine the finality principle while refusing [to] reinstate the action does not interfere with the need to ensure adequate remedies” (Giant Tiger at para. 41).
[59] Rule 37.14(1) of the Rules of Civil Procedure requires a motion to set aside a dismissal order to be brought “forthwith after the order comes to the person’s attention”. Rule 2.03 of the Rules of Civil Procedure authorize the court to dispense with compliance with any rule, including Rule 37.14(1), but “only where and as necessary in the interest of justice”. This condition was described by the Cronk J.A. in Wellwood (at para. 34) as being an “essential precondition” to the exercise of discretion under Rule 37.14 of the Rules of Civil Procedure.
[60] The inability of the plaintiff to explain his own undisputed delay in seeking relief renders the task of showing why it is necessary in the interest of justice to excuse him from the consequences of his inaction almost impossible. The stronger the weight of the defendant’s interest in the finality of the dismissal order, the stronger the plaintiff’s evidence of why it is “necessary in the interest of justice” to overturn it must be. Since prejudice of the plaintiff losing a claim will always be present in these motions, the interest of justice must look to other factors to provide that weight. This is why the quality of the explanation of the plaintiff for the delay acquires such importance and why the lack of an adequate explanation ought to have been afforded greater weight than it was in this case.
[61] The plaintiff learned of the existence of the dismissal order in April 2015. He did not learn of the dismissal order in circumstances where its importance might have been lost on him. He learned of its existence from a lawyer being interviewed to take over the file after he had sent numerous and clear warning letters to his former lawyer. He did so where his former (and present) lawyer (Mr. Pieters) had been in the background from shortly after the original status notice was received and in circumstances where his warning letters to his own lawyer displayed a keen awareness of the possibility that his claim was in danger of being permanently lost. He clearly knew there was peril.
[62] The lack of any satisfactory explanation for this nearly seven month time span cannot simply be dismissed – it needed a clear and convincing explanation. No satisfactory explanation was offered. In my view, the lack of any satisfactory explanation for failing to have acted promptly after learning of the dismissal order ought to have required a demonstration by the plaintiff of the most exceptional of circumstances before the conclusion that the interest of justice required a waiver of the explicit requirements of Rule 37.14(1) of the Rules of Civil Procedure could reasonably be considered.
[63] The task of explaining the delay is further complicated by the fact that those months of unexplained delay were preceded by more than a year of additional unexplained delay by the plaintiff’s counsel. The Master focused exclusively on the personal knowledge (or lack thereof) of the plaintiff about the existence of the dismissal order without giving weight to the fact that the plaintiff’s counsel, Ms. Claxton, was his counsel and agent throughout. Indeed, although the plaintiff was represented on the motion by Mr. Sasso, he appeared as agent for Ms. Claxton. By hiring Ms. Claxton as his lawyer, Mr. Dzuazah held her out to the Police defendants as his agent in all matters that may reasonably arise: Scherer v. Paletta, [1966] 2 O.R. (2d) 527; Jones v. Sidhu, 2014 ONSC 1487. The attribution of fault for the delay to Ms. Claxton prior to April 2015 cannot be applied as a sort of blanket excuse sufficient in and of itself to excuse the delay, particularly the delay that occurred after the plaintiff sought out other counsel and received confirmation of the dismissal order. Further, what weight can be given to Ms. Claxton’s inaction in the analysis must also be tempered by the fact that the plaintiff certainly knew of the risk of some peril to his claim and was not relying upon Ms. Claxton as the sole source of his legal advice about how to proceed in this matter for the entire time frame.
[64] I cannot credit as reasonable the speculation by the Master that the plaintiff “may have believed that Ms. Claxton was going to be able to cure the delay at the motion of February 7, 2014 by obtaining a new timetable” (at para. 61). There was no such evidence from the plaintiff nor was there any communication from Ms. Claxton that might have justified such an assumption. To the contrary, her email to him of January 31, 2014 mentioned that the February 7 motion was to be adjourned in favour of imminent settlement discussions. He was never advised that the motion was being rescheduled, the imminent settlement discussions referenced never took place and there is no evidence that he collected or delivered the documents his lawyer asked him to assemble preparatory to those discussions.
[65] Extraordinary or unusual circumstances must be found if the principle of finality is to be displaced. As I have noted, this must necessarily go beyond the always-present consideration of prejudice to the plaintiff. The alleged fault of Ms. Claxton for only a portion of the relevant time frame was given predominant weight by the Master to the exclusion of any other factor. The Master failed to give proper weight to the plaintiff’s own delay receiving confirmation from another lawyer of the issuance of the dismissal order, to his reliance on other sources of legal advice (Mr. Pieters) in the time frame where Ms. Claxton was actively involved or to the plaintiff’s own undoubted appreciation of the fact that his claim was in some peril of being lost as evidenced by his warning letters to his own counsel.
[66] The principle of finality applies for the benefit of the defendants who acquire a right to rely upon a dismissal order, which right is increasingly solidified “absent extraordinary or unusual circumstances” with the passage of time. The defendants are not privy to what goes on as between the plaintiff’s solicitor and her own client. The failure of the plaintiff’s own lawyers ought not to be visited upon the appellants where, as here, those failings are only a partial explanation for the delay at most.
[67] In my view, the nature of the extraordinary or unusual circumstances that ought to be necessary to displace that right should also be informed to some degree by a consideration of the lack of material forward progress shown by the plaintiff before the status hearing process began.
[68] The facts of the present case fully justified Mr. Reimer’s assumption in his affidavit that “the plaintiff had no real intent to proceed with this matter”: 1196158 Ontario Inc. at para. 27. After the statements of defence and response to particulars were delivered by August 2011, nothing whatever was done to progress the action. Various defendants were let out of the action via notices of discontinuance in early 2012, but no steps to secure and assemble documents or deliver and affidavit of documents are in evidence. No steps to secure witness statements are in evidence. No steps to negotiate a case timetable were taken even after the status notice. Vague suggestions of coming settlement proposals were made by plaintiff’s counsel but followed up with no actual proposals.
[69] In my view, the Master failed to give adequate or indeed any weight to the principle of finality. The failure to do so amounted to an error that resulted in the exercise of discretion on incorrect principles. I would reverse the decision of the Master and uphold the order of Registrar on this ground.
(c) Did the Master err in giving retrospective effect to Rule 48.14 of the Rules of Civil Procedure?
[70] The Master’s reasons analyzed the amendments to the Rules of Civil Procedure by which former Rules 48.14 and 48.15 were revoked and replaced with current Rule 48.14. The amendments were contained in O. Reg 170/14 published on August 19, 2014 – many months after the dismissal order was made in this case. The Master’s reasons noted that under the current formulation of Rule 48.14 of the Rules of Civil Procedure, actions commenced after January 1, 2015 will be dismissed for delay five years after the date of commencement. Had the new rule applied to this action, she noted, the plaintiff would have had until April 20, 2016 to set the matter down for trial. The action was thus dismissed under the old rules more than two years before it would have been dismissed under the new. The Master concluded in relation to this point that “the amendment to Rule 48.14 favours the plaintiff”.
[71] The moving party appellants submit that in so finding the Master gave retroactive application to the new formulation of Rule 48.14 of the Rules of Civil Procedure. I agree with the appellants to a degree, but cannot find that the Master has committed a reversible error in this regard.
[72] It is of course true that the Rules of Civil Procedure might have been amended so as to give Rule 48.14 retrospective effect. They were not. The failure to do so cannot be treated as a mere accident. It is also true that new Rule 48.14 was not in effect when the dismissal order appealed from was issued – it was published eight months later. The reference to subsequent legal history is at best a highly equivocal source of guidance to the exercise of judicial discretion in a case such as this; at worst, it may lead into outright error if given undue weight. However, I cannot find that it is always and everywhere an error to give the matter some consideration. Had the facts been different and the Master invoked the change in the Rules as a factor to uphold the dismissal order instead of reversing it, the applicable principles would have been the same but the shoe would be found on the other foot.
[73] In the present case, the Master did no more than attribute some weight to the factor of the change in the rules as an “additional factor”. There is certainly nothing to suggest that this factor was given decisive weight. The Master clearly understood that the new formulation of Rule 48.14 of the Rules of Civil Procedure did not actually apply to the circumstances of the case.
[74] This ground of appeal is not upheld.
Disposition
[75] In the result, I have found that the Master’s order granting the plaintiff’s motion was premised on two errors of law. That conclusion alone does not dispose of this appeal. If I am not bound by the Master’s exercise of discretion based upon erroneous legal principles, I must nevertheless consider how the discretion ought properly to have been exercised. Whether expressed as a contextual review of the four-part Reid test or the conjunctive two-part test requiring an acceptable explanation for delay and an assessment of non-compensable prejudice of the defendants in more recent cases, the overall objective on these motions remains the determination of a just result in the particular circumstances of the case: H.B. Fuller at para. 21. The inadequacy of the plaintiff’s explanation for delay and the lack of satisfactory evidence demonstrating the lack of prejudice means that the plaintiff was effectively unable to satisfy any of the criteria laid out in the numerous cases the Court of Appeal has considered in recent years. While the interest of justice will never be comprehensively described in any one test for all purposes and all time, I think it reasonable to observe that a very compelling case should have to be shown for exercising discretion in the plaintiff’s favour where the evidence is as far from satisfying the requirements described by precedent as is the case here.
[76] In the result, the appeal is allowed and the plaintiff’s motion to set aside the registrar’s dismissal order is dismissed. If the parties are unable to resolve the question of costs, I shall receive written submissions from the Police defendants within 21 days of the release of these reasons with responding submissions from the plaintiff 14 days thereafter. Submissions to be limited to 5 pages exclusive of outlines of costs and cases shall not be attached unless not available on-line. Submissions may be delivered to me together electronically through my assistant.
S.F. Dunphy, J.
Date: October 13, 2016
[1] The plaintiff’s affidavit suggested – on information attributed to Ms. Sasso’s firm – that the plaintiff was seeking co-operation from Ms. Claxton to bring the motion to set aside the registrar’s dismissal order. The record contains no indication of when Ms. Sasso was retained, when Ms. Claxton promised co-operation or what efforts were made and when to secure that cooperation. There is accordingly no basis to interfere with the Master’s finding at paragraphs 64 and 65 that the plaintiff has failed to explain the delay in bringing the motion to set aside.