Turino v. Shea, 2016 ONSC 6718

CITATION: Turino v. Shea, 2016 ONSC 6718

COURT FILE NO.: CV-12-110544-00

DATE: 20161031

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

ANNA TURINO

Plaintiff

– and –

CHI-WING SHEA and FIRST CANADA ULC o/a MARKHAM DIVISION

Defendants

Andra Preda, for the Plaintiff

Bahram Dehghan, for the Defendants

HEARD: October 18, 2016

REASONS FOR DECISION

Charney J.:

Introduction

[1] The moving party in this motion, Anna Turino, was the plaintiff in an action for damages arising out of a motor vehicle accident on September 14, 2010. That action was dismissed by Master Muir on May 9, 2016, for failure of the plaintiff to comply with an earlier order of Master Brott dated June 18, 2015, which required the plaintiff to appoint new counsel or file a Notice of Intention to Act in Person within 30 days (by July 18, 2015).

[2] The moving party moves under Rule 37.14 of the Rules of Civil Procedure to vary Master Brott’s order by extending the time period for appointing new counsel and to set aside Master Muir’s order dismissing the action. The plaintiff alleges that she was not aware of the motions before either Master Brott or Master Muir and was not aware of Master Brott’s order until she received a copy of Master Muir’s order on May 12, 2016.

Facts

[3] This action arises from a motor vehicle accident on September 14, 2010 in which the plaintiff alleges she was injured. The plaintiff was a passenger in one of the vehicles. The defendant Chi-Wing Shea was the driver of the other vehicle and the defendant First Canada ULC is the insurer of the defendant Shea.

[4] The action was commenced on July 31, 2012. The Statement of Defence was delivered on October 2, 2012. The plaintiff was represented during the course of the proceedings, including discoveries (completed in August 2013) and an unsuccessful mediation (on March 20, 2015), by Seth Kadish from the law firm Aaron Waxman and Associates (the former lawyers).

[5] On April 10, 2015, shortly after the March 20, 2015 mediation, Seth Kadish and Aaron Waxman served the plaintiff with a Notice of Motion to be removed from the record. The motion was granted by Master Brott on June 18, 2015. Master Brott gave the plaintiff 30 days to appoint a new lawyer or file a notice of intention to act in person, ordered the former law firm to serve the plaintiff by prepaid regular mail at 51 Little Hannah Lane, Maple, Ontario, and ordered that if the plaintiff failed to comply with the order the Court could dismiss the plaintiff’s proceeding.

[6] The plaintiff alleges that her last contact with the former lawyers was March 20, 2015 when she attended mediation with them. She took no steps to move the action forward after that date.

[7] On May 12, 2016 – 14 months after the mediation - the plaintiff received correspondence from the defendant’s counsel enclosing a copy of Master Muir’s order dated May 9, 2016. The order dismissed the plaintiff’s action for failing to comply with the order of Master Brott, dated June 18, 2015. Master Muir’s order also ordered costs against the plaintiff in the amount of $25,000.00

[8] The plaintiff attested that she telephoned her former lawyers on May 12, 2016 and received no reply. She called her former lawyer again on May 17, 2016 and was advised by a law clerk that that the former law firm had brought a motion to be removed from the record and that the defendant brought a motion to have the case dismissed. She then attended the office of the former lawyer on the afternoon of May 17, 2016, and obtained a copy of Master Brott’s order dated June 18, 2015. She alleges that this was the first she had heard of or seen this order.

[9] The plaintiff alleges that she did not receive any notice regarding her former lawyer’s motion to be removed from the record, did not receive a copy of Master Brott’s order when it was made, and did not receive notice of the defendants’ motion to have her action dismissed.

[10] The plaintiff’s affidavit confirms that between July 2014 and May 2016 she has resided at 51 Little Hannah Lane, Maple, Ontario, with her two adult children. The property is serviced by a community mailbox. A photo of the mailbox shows that it is a Canada Post community mailbox with a key for each compartment. The plaintiff attests that “At no point in time during my residence at this address was I served with any documentation or mailed any correspondence with respect to any Motion. I have not had any issues receiving mail in the past.”

[11] The plaintiff also states that she attended the Newmarket Court on June 3, 2016 to review the file, and that this was the first time that she was aware that she was no longer represented by a lawyer or that there was an order requiring her to appoint a new lawyer or file a Notice of Intention to Act in Person. I note that this statement is inconsistent with her earlier statement that she was advised of her former lawyer’s motion and given a copy of Master Brott’s order when she went to her former lawyer’s office on May 17, 2016.

[12] The defendant asserts that contrary to the plaintiff’s affidavit she was served with all of the relevant notices of motion and court orders at her residence in accordance with the Rules and court orders. The affidavit filed by the defendant’s counsel sets out six separate occasions when the plaintiff was served with either a Notice of Motion or a court order at her residence at 51 Little Hannah Lane, Maple, Ontario. Each instance was supported with an affidavit of service by regular mail. None of the documents were returned by Canada Post as undelivered.

[13] Her former lawyer’s Notice of Motion to be removed from the record was served on the plaintiff by sending a copy via regular mail to the plaintiff’s residence at 51 Little Hannah Lane, Maple, Ontario, on April 10, 2015, shortly after the March 20, 2015 mediation and nearly two months before the motion was heard. An affidavit of service sworn April 10, 2015 was filed with the court.

[14] Master Brott’s order of June 18, 2015 provides that a copy of her order is to be served on the plaintiff by prepaid regular mail at her last known address at 51 Little Hannah Lane, Maple, Ontario. Pursuant to that order the plaintiff’s former lawyers served a copy of Master Brott’s order on the plaintiff by regular mail on June 19, 2015. An affidavit of service dated June 19, 2015 was filed with the court.

[15] Out of an abundance of caution the defendant’s solicitor also served a copy of Master Brott’s order with a covering letter on the plaintiff at the address indicated by ordinary mail on July 6, 2015. An affidavit of service dated July 6, 2015 was filed with the court. The letter of July 6, 2015 was never returned to the defendant’s lawyer as undelivered.

[16] Having received no response from the plaintiff, the defendant’s lawyer wrote to her again on December 10, 2015 enclosing a further copy of Master Brott’s order and requesting that the plaintiff appoint a new solicitor or file a Notice of Intention to Act in Person as required by that order. An affidavit of service dated March 3, 2016 was filed with the court. The letter of December 10, 2015 was never returned to the defendant’s lawyer as undelivered.

[17] Given the plaintiff’s failure to comply with Master Brott’s order or respond to the defendant’s lawyer’s correspondence of July 6, 2015 and December 10, 2015, the defendant scheduled a motion for May 9, 2016 to obtain an order dismissing the action with costs. The defendants served the plaintiff with their Notice of Motion by regular mail at her home address at 51 Little Hannah Lane, Maple, Ontario on March 4, 2016 with a covering letter. An affidavit of service was filed with the court. As before, the letter and motion materials were never returned to the lawyer’s office as undelivered.

[18] The defendant’s lawyer wrote to the plaintiff again on April 29, 2016 to provide a Confirmation of Motion with a covering letter. The Confirmation was served by regular mail at the plaintiff’s residence. An affidavit of service dated May 3, 2016 was filed with the court. This letter was never returned as undelivered.

[19] In a reply affidavit Ms. Turino states that she has no explanation as to why she did not receive any of the documentation delivered by regular mail.

[20] On May 10, 2016, the defendant’s lawyer wrote to the plaintiff at her residence at 51 Little Hannah Lane, Maple, Ontario, enclosing a copy of the issued and entered order of Master Muir. The plaintiff acknowledges receiving this letter and enclosures on May 12, 2016.

[21] On May 20, 2016, Rhanda Felix, the assistant to the defendant’s lawyer, Nelson Dewey, received a phone call from Rita Williams, a casualty adjuster at Intact Insurance, the plaintiff’s insurance company. Ms. Felix made a record of the discussion which is attached to the affidavit of Mr. Dewey. According to that record, Ms. Williams advised Ms. Felix that the plaintiff attended their office to seek help with the Master Muir’s order. Ms. Williams stated that Ms. Turino wanted to know what to do and how to appeal as she does not have the funds to pay the costs order and was worried a lien would be placed on her house. Ms. Williams stated that Ms. Turino told her that she did not understand why all of this had transpired after she said that she was abandoning the claim and thought that it was all done. Ms. Williams asked that the defendant’s lawyer call Ms. Turino “to explain to her”.

[22] The plaintiff acknowledges that she did speak to Ms. Williams, but takes the position that the evidence in Mr. Dewey’s affidavit is outside his personal knowledge and is inadmissible hearsay.

Rule 37.14

[23] Rule 37.14 authorizes a person who fails to appear on a motion through accident, mistake or insufficient notice to move to set aside or vary the order. The Rule provides:

37.14 (1) A party or other person who,

(a) is affected by an order obtained on motion without notice;

(b) fails to appear on a motion through accident, mistake or insufficient notice; or

(c) is affected by an order of a registrar,

may move to set aside or vary the order, by a notice of motion that is served forthwith after the order comes to the person’s attention and names the first available hearing date that is at least three days after service of the notice of motion.

(2) On a motion under subrule (1), the court may set aside or vary the order on such terms as are just.

[24] The plaintiff argues that she falls within paragraph 37.14(1)(b) because she failed to appear because she did not receive either of the Notices of Motion or Master Brott’s order “through accident, mistake or insufficient notice”.

[25] She also relies on Rule 16.07, which provides:

16.07 Even though a person has been served with a document in accordance with these rules, the person may show on a motion to set aside the consequences of default, for an extension of time or in support of a request for an adjournment, that the document,

(a) did not come to the person’s notice; or

(b) came to the person’s notice only at some time later than when it was served or is deemed to have been served.

[26] In Ontario (Attorney General) v. 15 Johnswood Crescent, 2009 CanLII 50751 (ON SC), Strathy J. (as he then was) outlined the purpose of Rule 37.14 (at para. 29):

…to prevent unfairness or, worse, a miscarriage of justice, where a party’s inadvertence or the absence of sufficient notice has resulted in an order being obtained without that party being afforded an opportunity to present his or her case. A party who does not appear in these circumstances will usually be given a chance to present evidence and to argue the motion on its merits, assuming he or she moves promptly and provided there are no countervailing considerations.

[27] Strathy J. set out the following factors to be considered in the court’s exercise of its discretion in the application of Rule 37.14:

(1) Proof of accident or mistake: The moving party must establish a failure to appear on the original motion through accident, mistake or insufficient notice. This is a precondition to relief under the rule. A party who has simply chosen not to appear on a motion cannot complain later if he or she does not like the outcome.

(2) The party must move forthwith after the order comes to his or her attention: This is also a precondition to relief under the rule, but there is room for flexibility in the interpretation of “forthwith”, depending on the circumstances. I will examine this requirement in more detail below.

(3) The length of the delay and the reasons for it: In considering whether to set aside an order, the court will consider whether there has been delay in bringing the motion and the reason for it. All other things being equal, the longer an order has been in effect, particularly where parties have acquired rights or changed their positions as a result of the order, the less likely it will be that the court will set it aside.

(4) The presence or absence of prejudice: The court should consider whether a party will be prejudiced by setting aside the order or by failing to set aside the order. There will always be prejudice if an order is made against a party without sufficient notice and there will always be some kind of prejudice to the other party if the order is set aside. Nevertheless, the exercise of the court’s discretion may require an examination of the relative prejudice to the parties.

(5) The underlying merits of the moving party’s case: It may be necessary to consider the underlying merits of the moving party’s case in weighing the various factors, balancing the interests of the parties, and determining what is just in the circumstances. Lengthy delay in bringing the motion may be more readily forgiven if the moving party has a very strong case on the merits. It will be less readily forgiven if the party’s case appears frivolous.

[28] Where failure to appear on the motions was not the result of “accident, mistake or insufficient notice” Rule 37.14 has no application. That is why Strathy J. refers to “proof of accident or mistake” as a “precondition” to relief under the rule.

Analysis

[29] The plaintiff claims that she did not receive any of the six documents mailed to her home address. If she can prove this claim she meets the precondition to the application of Rule 37.14.

[30] It is often difficult, however, to prove a negative. In this regard, the jurisprudence with respect to Rule 19.08 (setting aside default judgment) may provide some assistance

[31] Under Rule 19.08 the courts have indicated that they will consider five factors similar to the five factors listed by Strathy J. with regard to Rule 37.14. For the purposes of this analysis the second factor is of particular assistance. It asks “whether there is a plausible excuse or explanation for the defendant’s default in complying with the Rules” (see Mountain View Farms Ltd. v. McQueen, 2014 ONCA 194 at paras. 48-49). The requirement of “proof of accident or mistake” is similar to the requirement of “plausible excuse or explanation” under Rule 19.08. I would be inclined to not require “proof” if a claim of accident or mistake cannot be proven but is at least plausible. Plausibility is an important consideration because it is an easy matter for a party served by ordinary mail to simply deny receiving the mail. A determination of whether this simple denial is a plausible explanation must be based on the circumstances of the specific case.

[32] The evidence in this case establishes beyond doubt that the plaintiff was served with notice of the motion before Master Brott and was served twice with the notice of motion before Master Muir. The evidence also establishes that the plaintiff was served with Master Brott’s order on three separate occasions by two different law firms. On each occasion the law firm served the plaintiff in accordance with Rules 16.01 and 16.06 of the Rules of Civil Procedure and the order of Master Brott. All of these documents were mailed to the correct address and were never returned by the post office as undelivered.

[33] I do not believe the plaintiff’s claim that she did not receive any of these documents. This claim strains credulity and is implausible.

[34] The implausibility of her claim is confirmed by the information provided in the telephone conversation by Rita Williams, the casualty adjuster at Intact Insurance, to Mr. Dewey’s assistant Rhanda Felix. The information provided by Ms. Williams is a much more plausible explanation: that the plaintiff had abandoned her claim after the unsuccessful mediation. That would explain why the plaintiff had done nothing to move the claim forward after the unsuccessful mediation on March 20, 2015, and had made no effort to contact her former solicitor after that date.

[35] The plaintiff asserts that the information in Mr. Dewey’s affidavit regarding this telephone communication is inadmissible hearsay. Rule 39.01(4) provides that “an affidavit for use on a motion may contain statements of the deponent’s information and belief, if the source of the information and the fact of the belief are specified in the affidavit.” Unlike evidence in an application (Rule 39.01(5)) “information and belief” facts in a motion are not limited to “facts that are not contentious.” The plaintiff could have filed a reply affidavit from Ms. Williams, but did not. She could have also cross-examined Ms. Felix, who swore an affidavit in these proceedings, but chose not to.

[36] The implausibility of the plaintiff’s claim is also confirmed by the fact that she acknowledges that she has not had any issues receiving mail in the past, has no explanation as to why she did not receive any of the documents delivered by regular mail, but she did receive by regular mail the order of Master Muir which included an order that she pay $25,000 in costs.

[37] Finally, there is an unexplained inconsistency between paragraphs 18 and 19 of the plaintiff’s affidavit, in which she attests that she first became aware and obtained a copy of Master Brott’s order on May 17, 2016 when she spoke to a clerk and attended her former lawyer’s office, and paragraph 32 of the same affidavit, in which she attests that “until attending Newmarket Court on June 4, 2016, I was unaware that I was no longer represented by a lawyer or that there was an order requiring me to appoint a new lawyer or file a Notice of Intention to Act in Person”. This contradiction indicates that the plaintiff is an unreliable witness who cannot keep her story straight.

Conclusion

[38] Accordingly, I conclude that the plaintiff did not fail to appear on the motions through accident, mistake or insufficient notice. Since the plaintiff does not meet the precondition to the application of Rule 37.14, it is not necessary for me to consider the other factors set out in the 15 Johnswood Crescent case.

[39] For the above reasons I dismiss the plaintiff’s motion.

[40] If the parties cannot agree on costs, the defendant may file written submissions of not more than 3 pages plus costs outline and any offers to settle within 25 days of the release of this ruling, followed by the plaintiff’s submissions on the same terms within a further 15 days.

Justice R.E. Charney

Released: October 31, 2016

CITATION: Turino v. Shea, 2016 ONSC 6718

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

ANNA TURINO

Plaintiff

– and –

CHI-WING SHEA and FIRST CANADA ULC o/a MARKHAM DIVISION

Defendants

REASONS FOR Decision

Justice R.E. Charney

Released: October 31, 2016