Court File and Parties

COURT FILE NO.: CV-09-94952 DATE: 20170515 ONTARIO SUPERIOR COURT OF JUSTICE

BETWEEN:

David Anthony Martin Applicant – and – Claudette Ann-Marie Miller Respondent

Counsel: Patrick Di Monte, for the Applicant Michael Smith, for the Respondent

HEARD: April 27, 2017

REASONS FOR DECISION

CHARNEY J.

[1] This motion is brought by the Respondent, Claudette Ann-Marie Miller, pursuant to Rule 49.09 of the Rules of Civil Procedure for judgment in terms of an offer to settle which was made by the Applicant, David Anthony Martin on September 2, 2015, and which she claims to have accepted on March 13, 2017.

[2] Rule 49.09 provides:

49.09 Where a party to an accepted offer to settle fails to comply with the terms of the offer, the other party may,

(a) make a motion to a judge for judgment in the terms of the accepted offer, and the judge may grant judgment accordingly; or

(b) continue the proceeding as if there had been no accepted offer to settle.

Facts

[3] The Applicant, Mr. Martin, commenced this claim by Notice of Application dated June 11, 2009. The claim related to a property interest in a property located at 102 Cabernet Circle in Toronto, Ontario (the property). By court order dated March 20, 2012 the Respondent, Ms. Miller, was ordered to deliver a Statement of Claim in relation to her claim to be the owner of the property. The Statement of Claim was dated May 9, 2012. The Applicant filed a Statement of Defence on October 12, 2012.

[4] I glean from the affidavit material that Mr. Martin and Ms. Miller were at one time cohabitating spouses who separated.

[5] On June 10, 2015 Ms. Miller registered a Caution on the property. On July 16, 2015 Ms. Miller brought a motion for a Certificate of Pending Litigation and that motion was dismissed on July 17, 2015.

[6] On September 2, 2015 counsel for Mr. Martin, Mr. Di Monte, sent Ms. Miller’s lawyer, Mr. Smith, a letter offering to settle the matter in the amount of $10,000. The letter was brief and stated:

We are hoping to close today, if the purchaser can get funds from Home Trust or Mr. Martin can get a bridge loan. His offer of settlement is $10,000.00.

[7] On September 15, 2015 Mr. Smith wrote to Mr. Di Monte to schedule dates for cross-examination. On September 18, 2015 Mr. Di Monte responded that “I have been advised that our clients have apparently settled this matter.”

[8] Mr. Smith emailed Mr. Di Monte on September 21, 2015:

I just spoke to Ms. Miller who told me that no settlement has been made. Let’s proceed with Affidavits of Documents and discoveries.

[9] Three hours later Mr. Di Monte replied by email “I was told otherwise. $10,000.00 to your client.”

[10] Thirty minutes later Mr. Smith replied by email:

Was it ($10,000) paid? Was the agreement made in writing? Was the agreement made at all? Ms. Miller says “NO” to all those questions.

[11] Once again on September 23, 2015 Mr. Smith wrote to Mr. Di Monte stating, “Our client advises that her claim is not settled” and enclosing a draft affidavit of documents.

[12] It appears that Mr. Martin kept insisting that Ms. Miller had agreed to a settlement. On October 7, 2015 Mr. Smith emailed Mr. Di Monte again, stating:

My client insists there is no settlement…Could you persuade your client to participate in meaningful settlement discussions?

[13] And again on November 1, 2015:

The idea of my proving to you that the case is not settled is strange. You and I are the lawyers on the case. Is there any sign of Settlement? A written agreement? A payment? Anything at all but your client’s delusional presumption and domineering attitude toward Ms. Miller? The case is not settled. If your client wants to settle he has to make an offer.

[14] On November 20, 2015 Mr. Smith wrote again to Mr. Di Monte:

This letter will again confirm my advising you that this matter has not settled.

Your client’s assertion that it has settled is simply false. There is no element of settlement in existence: not agreement, no written agreement, no correspondence, no payment, no proof of payment, nothing to corroborate your client’s false assertion that the parties have settled.

If your client is interested in settlement have him make an offer, through counsel in the usual way.

[15] There appears to be no correspondence subsequent to the November 20, 2015 letter until March 13, 2017, when Mr. Smith wrote to Mr. Di Monte to accept the offer contained in Mr. Di Monte’s letter of September 2, 2015. He stated:

By letter dated September 2, 2015…your client has offered to settle this dispute by payment to our client of $10,000. Our client hereby accepts that offer of settlement. We will apply toward the settlement payment the amount of $5,936.92 held in our trust account to the credit of this action. The balance of $4,063.08 is payable forthwith.

Rule 49 Offers

[16] The Rules relating to the withdrawal and acceptance of offers to settle are set out in Rule 49.04 (withdrawal or expiry of offers) and Rule 49.07 (acceptance of offers) of the Rules of Civil Procedure. These rules provide:

WITHDRAWAL OR EXPIRY OF OFFER

Withdrawal

49.04 (1) An offer to settle may be withdrawn at any time before it is accepted by serving written notice of withdrawal of the offer on the party to whom the offer was made.

(2) The notice of withdrawal of the offer may be in Form 49B.

Offer Expiring after Limited Time

(3) Where an offer to settle specifies a time within which it may be accepted and it is not accepted or withdrawn within that time, it shall be deemed to have been withdrawn when the time expires.

Offer Expires when Court Disposes of Claim

(4) An offer may not be accepted after the court disposes of the claim in respect of which the offer is made.

[17] Rule 49.07 of the Rules of Civil Procedure provides for the acceptance of offers to settle. It provides:

ACCEPTANCE OF OFFER

Generally

49.07 (1) An offer to settle may be accepted by serving an acceptance of offer (Form 49C) on the party who made the offer, at any time before it is withdrawn or the court disposes of the claim in respect of which it is made.

(2) Where a party to whom an offer to settle is made rejects the offer or responds with a counter-offer that is not accepted, the party may thereafter accept the original offer to settle, unless it has been withdrawn or the court has disposed of the claim in respect of which it was made.

Position of the Parties

[18] Ms. Miller takes the position that the settlement offer in Mr. Di Monte’s letter of September 2, 2015 was a written Rule 49 offer that does not expire unless it includes an expiry date or is withdrawn by a written notice of withdrawal.

[19] The offer of September 2, 2015 did not specify a time within which it had to be accepted, nor was it ever withdrawn by serving a written notice of withdrawal as required by Rule 49.04(1). It was accepted before it was withdrawn by serving an acceptance of the offer pursuant to Rule 49.07(1).

[20] While Ms. Miller did initially reject the offer (despite Mr. Martin’s insistence that she had accepted it), Rule 49.07(2) provides that she may still accept the original offer unless it has been withdrawn in accordance with Rule 49.04(1) - (3) or the court has disposed of the claim in respect of which it was made.

[21] Mr. Martin, in an affidavit filed by Mr. Di Monte’s secretary, takes the position that circumstances have changed since the offer was made in September of 2015. The affidavit asserts that as recently as two months ago there were oral settlement discussions between Mr. Smith and Mr. Di Monte. The affidavit asserts that there is also a family court proceeding “which Ms. Miller has now commenced and has been adjourned.” The affidavit material filed on behalf of Mr. Martin does not provide me with any more information than that – I do not know when the family court proceeding was commenced, where it was commenced, or what it relates to. The affidavit states that there is a Small Claims Court claim for commission claimed on the sale of the property. The affidavit states “If Ms. Miller were to assert any interest in the Cabernet property, the outcome of that Small Claims Court Claim would have an impact on the accounting as well.” The affidavit material filed on behalf of Mr. Martin does not provide me with any more information than that – I do not know, for example, who are the parties in the Small Claims Court proceeding or what the potential “impact on the accounting” in that case might be.

[22] The affidavit states that Mr. Martin is “attempting to formulate an offer which would encompass all aspects of the relationship between Mr. Martin and Ms. Miller” and Ms. Miller should not be permitted to “pull out a one and half year old letter purporting to accept an offer which she herself flat out rejected.” The affidavit filed on behalf Mr. Martin takes the position that all matters impacting the relationship between Mr. Martin and Ms. Miller “should be traversed to the Superior Court of Justice – Family Division”, although I am not aware that Mr. Martin has brought any motion to do so.

Analysis

[23] In my view the issue in this case is resolved by the decision of the Ontario Court of Appeal in York North Condominium Corp. No. 5 v. Van Horne Clipper Properties Ltd. (1989), 70 O.R. (2d) 317 (C.A.). In that case the court explained that the common law principles of contract law relating to offer and acceptance of offers to settle have now been replaced by the principles set out in Rule 49. Accordingly, rejection of an offer to settle does not foreclose the later acceptance of the original offer. The Court stated:

In the case on appeal, the offer of settlement of the respondent was conceded to be pursuant to rule 49.02. It was open-ended and no written notice of its withdrawal was served upon the appellant as required by rule 49.04(1). It was accepted before it was withdrawn by serving an acceptance of offer pursuant to rule 49.07(1). Whether the written offer was "implicitly withdrawn" by the subsequent oral offer is not a valid issue. The oral offer was not accepted and the written offer could only be withdrawn in writing. The common law principles of contract law relating to offer and acceptance have no application to Rule 49... It is to be noted, for example, that rule 49.07(2) replaces the usual common law provision that rejection of an offer or the making of a counter-offer forecloses a later acceptance of the original offer.

[24] This analysis was recently summarized by C.J. Brown J. in Marshall Estate v. Legge & Legge, 2015 ONSC 3028, at paras. 10 and 11:

A Rule 49 offer may provide for its own expiry, or it may be withdrawn at any time by serving written notice of withdrawal, which may be in the prescribed form: rr. 49.04(1)-(2). Where an offer to settle specifies the time within which it may be accepted and is not accepted or withdrawn within that time, it shall be deemed to have been withdrawn when the time expires: r. 49.04(3). That is not the case here, as there was no time limit specified in the Rule 49 offer. Furthermore, an offer to settle under the Rules cannot be withdrawn orally: York North Condominium Corp. No. 5 v. Van Horne Clipper Properties Ltd. (1989), 70 O.R. (2d) 317 (C.A.); Smith v. Robinson, supra.

An offer to settle is not terminated by a counter-offer or rejection. Where a party to whom an offer to settle is made rejects the offer or responds with a counter-offer which is not accepted, the party may thereafter accept the original offer to settle, unless it has been withdrawn or the court has disposed of the claim in respect of which it is made: r. 49.07(2). Oral discussions do not displace written offers made pursuant to Rule 49. A written settlement offer can only be withdrawn in writing, and it cannot be implicitly withdrawn by a subsequent oral offer.

[25] Accordingly, I do not accept the Applicant’s submission that as a result of Ms. Miller’s earlier rejection of the September 2, 2015 offer, or the subsequent oral settlement discussions between counsel, the Applicant’s offer was deemed withdrawn. Nor do I accept the position that the offer made in relation to this action is somehow withdrawn or otherwise affected by virtue of the Family Court case or the Small Claims Court case. If the settlement of this action will have an impact on the accounting in the Small Claims Court case then that will be a matter to raise in the Small Claims Court case.

[26] I accept that the September 2, 2015 offer to settle qualifies as a Rule 49 offer, and that the March 13, 2017 letter of acceptance qualifies as a Rule 49 acceptance of that offer.

[27] While the Court has discretion whether to enforce an accepted offer, the Applicant has provided me with nothing but vague generalities to support his position. The fact that he may be “attempting to formulate” a new offer to deal with other proceedings is simply too speculative and inchoate for me to consider as a serious factor.

Conclusion

[28] Based on the foregoing I conclude that this is an appropriate case in which to make an order for judgment in the terms of the offer accepted by the Respondent on March 13, 2017, and I grant judgment accordingly. This Court Orders that an Order be made in accordance with the terms set out in the draft order at Tab 7 of the respondent’s motion record.

[29] Costs fixed at $4,000 payable by the Applicant, David Martin, within 30 days.

Justice R.E. Charney Released: May 15, 2017