Deonath v Iqubal, 2017 ONSC 3672

Case Summary

Kamalita Deonath was injured in a parking lot collision involving Javed Iqubal, an employee of RockTenn Display Company. Deonath's claim for benefits was eventually accepted by the Workplace Safety and Insurance Board (WSIB), leading to a "without costs" dismissal of the main action against Iqubal and Honda Canada Finance Inc. RockTenn, the Third Party, subsequently brought a motion seeking dismissal of the Third Party Claim and recovery of its costs, arguing that the WSIB had exclusive jurisdiction. The court dismissed the Third Party Claim without costs, but denied RockTenn's request for costs and instead ordered RockTenn to pay costs for the motion, finding its conduct in bringing the motion unreasonable and unnecessary given the prior settlement offers. interesting_citations_summary: > This decision provides a practical application of principles governing costs awards under the Courts of Justice Act and Rule 57 of the Rules of Civil Procedure, emphasizing fairness, reasonableness, and proportionality. It clarifies that a party is justified in commencing a third-party claim when there is a substantial risk regarding WSIB jurisdiction and limitation periods, especially when the WSIB determination is uncertain or delayed. The court also highlights that bringing a motion solely for costs, particularly when a without-costs resolution was available and the moving party's conduct was uncooperative, constitutes unreasonable litigation behaviour warranting an adverse costs order. final_judgement: > The Third Party Claim was dismissed without costs. RockTenn Display Company was ordered to pay costs of $1,500.00 plus H.S.T. to Javed Iqubal and Honda Canada Finance Inc. for the motion, payable within 60 days. winning_degree_applicant: 4 winning_degree_respondent: 1 judge_bias_applicant: 0 judge_bias_respondent: 0 year: 2017 decision_number: 3672 file_number: "CV-11-1794-AI" source: "https://www.canlii.org/en/on/onsc/doc/2017/2017onsc3672/2017onsc3672.html" keywords: - Costs - Third Party Claim - WSIB - Workplace Safety and Insurance Act - Exclusive Jurisdiction - Limitation Period - Rules of Civil Procedure - Proportionality - Unreasonable Conduct areas_of_law: - Civil Procedure - Costs - Workplace Safety and Insurance cited_cases: legislation: - title: "Workplace Safety and Insurance Act" url: "https://www.ontario.ca/laws/statute/97w16" - title: "Courts of Justice Act, R.S.O. 1990 c. C.43, section 131" url: "https://www.ontario.ca/laws/statute/90c43" - title: "Rules of Civil Procedure, R.R.O. 1990, Reg. 194" url: "https://www.ontario.ca/laws/regulation/900194" case_law: - title: "394 Lakeshore Oakville Holdings Inc. v. Misek, 2010 ONSC 7238, para. 10" url: "https://www.canlii.org/en/on/onsc/doc/2010/2010onsc7238/2010onsc7238.html" - title: "Boucher v. Public Accountants Council for the Province of Ontario (2004), 71 O.R. (3d) 291 (C.A.)" url: "https://www.canlii.org/en/on/onca/doc/2004/2004canlii14579/2004canlii14579.html" - title: "Moon v. Sher (2004), 246 D.L.R. (4th) 440 (C.A.)" url: "https://www.canlii.org/en/on/onca/doc/2004/2004canlii39005/2004canlii39005.html" - title: "Gratton-Masuy Environmental Technologies Inc. (c.o.b. Ecoflow Ontario) v. Building Materials Evaluation Commission, 2003 ONSC 8279, [2003] O.J. No. 1658, at para. 17" url: "https://www.canlii.org/en/on/onscdc/doc/2003/2003canlii8279/2003canlii8279.html" - title: "Patene Building v. Niagara Home, 2010 ONSC 468" url: "https://www.canlii.org/en/on/onsc/doc/2010/2010onsc468/2010onsc468.html" - title: "Maida v. Goodmurphy, 2012 ONSC 222, para. 22" url: "https://www.canlii.org/en/on/onsc/doc/2012/2012onsc222/2012onsc222.html" --- COURT FILE NO.: CV-11-1794-AI DATE: 2017-06-13 ONTARIO SUPERIOR COURT OF JUSTICE B E T W E E N: KAMALITA DEONATH No one appearing, for the Plaintiff Plaintiff - and - JAVED IQUBAL, HONDA CANADA FINANCE INC., and THE WAWANESSA MUTUAL INSURANCE COMPANY Defendants A. Martin, for the defendants Javed Iqubal and Honda Canada Finance No one appearing for the Defendant Wawanesa - and - ROCKTENN DISPLAY COMPANY Third Party B. Thomas, for the Third Party HEARD: June 13, 2017, at Brampton, Ontario Price J. Reasons For Order ## OVERVIEW [1] Kamalita Deonath was injured when she was struck by a vehicle in the parking lot of RockTenn Display Company. The collision occurred after Ms. Deonath exited from the RockTenn building where she had performed services on behalf of the temporary personnel agency that employed her. Ms. Deonath began the present proceeding against the driver of the vehicle, Javed Iqbal, who was an employee of RockTenn, and Honda Canada, which leased the vehicle to RockTenn. Mr. Iqbal and Honda issued a Third Party Claim against RockTenn, as Mr. Iqubal was in the course of his employment at the time of the collision and RockTenn was vicariously liable for his negligence. [2] Because both Ms. Deonath’s employer and RockTenn were Schedule 1 employers under the Workplace Safety and Insurance Act (“WSIA”), whose employees’ injuries are covered by Workplace Insurance, provided the injury occurs in the course of employment of both the injured employee and the at fault motorist. [3] RockTenn did nothing to assist Ms. Deonath in her claim for benefits, which was initially dismissed by the Workplace Safety and Insurance Board on the ground that Ms. Deonath had left RockTenn’s premises before being injured. It also did nothing to assist in Ms. Deonath’s appeal to the Workplace Safety and Insurance Board Appeals Tribunal, which ultimately allowed her appeal, two years and three months after she made it, on the ground that the injury was work-related, having occurred a reasonable period after she finished work, and while she was crossing the parking lot, an activity reasonably incidental to her employment, since she was a temporary worker who had performed services at RockTenn’s building, accessible only from the parking lot. [4] RockTenn did nothing to try to settle the Third Party Claim against it by raising the issue of the WSIB’s exclusive jurisdiction over the claim. After Ms. Iqbal and Honda settled the main action against them by a dismissal of that action without costs, and although they were similarly prepared to settle their Third Party Claim by a dismissal of it without costs, RockTenn brought the present motion for a dismissal of the Claim, which would have been administratively dismissed in any event, in order to recover its modest costs. [5] RockTenn argues that it should be granted its costs on the ground that Iqbal and Honda should not have issued the Third Party Claim against it because the WSIB had exclusive jurisdiction, notwithstanding that the Appeals Resolution Officer of the WSIB did not hold that the WSIB had jurisdiction until May 12, 2015, almost a year after June 4, 2014, when the two year limitation period for issuing a Third Party Claim expired. [6] For the reasons that follow, the Third Party Claim will be dismissed, with no costs of the action, and with costs of the motion to be paid by RockTenn. ## BACKGROUND FACTS [7] On October 13, 2010, Ms. Deonath was employed by Apple One Employment Service, a temporary agency that supplied workers to RockTenn. While in the parking lot outside the RockTenn premises, she was struck by a car operated by RockTenn’s employee, Javed Iqubal, who was operating a vehicle which RockTenn leased from Honda Canada. [8] The collision took place after the end of the afternoon work shift, which Ms. Deonath and Mr. Iqbal had worked. Ms. Deonath had just exited the RockTenn facility, which was accessible only by crossing the parking lot. [9] On May 2, 2011, Ms. Deonath began her action against: a) Mr. Iqbal, as driver; b) Honda Canada, as owner; and c) Her own insurance company, Wawanesa, under the unidentified, uninsured, or underinsured coverage of her auto insurance policy, although she later discontinued her action against Wawanesa because Mr. Iqbal had adequate insurance. [10] Mr. Iqbal and Honda Canada delivered their Statement of Defence on August 29, 2011. They began a third Party Claim against RockTenn approximately 7 months later, on March 9, 2012, and served it on RockTenn on May 16, 2012. RockTenn’s lawyer tried to get a waiver of defence but did not hear back from the lawyer for Mr. Iqbal and Honda Canada by the June 4, 2012, deadline for delivering a Defence, so she delivered a Defence that day. [11] Examinations for discovery in the main action proceeded on September 20, 2012, at which time the parties discussed whether Ms. Deonath was entitled to make a claim to the WSIB for benefits. During a telephone call in February 2013, RockTenn’s lawyer told Ms. Deonath’s lawyer that, in her opinion, the WSIB likely had exclusive jurisdiction over the claim, by reason of s. 28 of the WSIA, as both Ms. Deonath and Mr. Iqbal were in the course of their employment at the time of the collision. RockTenn’s lawyer urged Ms. Deonath’s lawyer to make a claim for benefits to the WSIB. [12] Soon after the call, Ms. Deonath applied to the WSIB for benefits. In June 2013, the WSIB denied her claim on the ground that the parking lot was not owned by RockTenn and Ms. Deonath was not in the course of her employment at the time of the collision, having already left RockTenn’s premises. In December 2013, Ms. Deonath appealed the decision of the WSIB with the assistance of Mr. Iqbal’s counsel. The appeal was heard in April 2015, and in May 2015, the appeal was allowed and Ms. Deonath’s claim was accepted by WSIB on the ground that Ms. Deonath was a temporary worker who had just left RockTenn’s premises, where she had been dispatched, and had to cross the parking lot to get to and from RockTenn’s premises, with the result that she was engaged in an activity “reasonably incidental” to her employment. [13] As WSIB accepted Ms. Deonath’s claim, she agreed to a “without costs” dismissal of the main action, and signed a full and final release on July 2, 2015. From July 2015, to February 2017, the lawyer for Mr. Iqbal and Honda Canada corresponded with RockTenn’s lawyer to request instructions for a dismissal of the Third party Claim without costs. On February 2017, RockTenn’s lawyer advised the lawyer for Mr. Iqbal and Honda Canada that RockTenn would be bringing a motion for costs of the Third Party Claim. ## ISSUES [14] Who is entitled to their costs of the Third Party Claim and of the present motion and in what amount? ## PARTIES’ POSITIONS [15] RockTenn submits that it is entitled to its costs on the ground that, because the Workplace Safety and Insurance Board Appeals Tribunal held that Ms. Deonath and Mr. Iqbal were in the course of their employment at the time of the collision and the WSIB granted Ms. Deonath benefits, the WSIB had exclusive jurisdiction over her claim, pursuant to s. 28 of the WSIA. [16] RockTenn submits that: Mr. Iqbal was not justified in commencing the Third Party Claim herein before exploring whether Ms. Deonath’s claim was statute barred by operation of s. 28 of the WSIA. Rather, he should have first urged Ms. Deonath’s counsel to have her apply for WSIB benefits, and if she did not, should have brought a “Right to Sue” Application to the Workplace Safety and Insurance Board Appeals Tribunal for a determination as to whether her right of action against him was taken away. [17] Mr. Iqbal and Honda Canada submit that they had until August 29, 2013, two years after they served their Statement of Defence, to issue their Third Party Claim, with the result that the limitation period would have expired well before April 2015, when Ms. Deonath’s appeal was heard and she was successful in her claim. They submit that “it was reasonable for Mr. Iqbal and Honda Canada to issue their Third Party Claim to protect their claim to contribution and indemnity. ## ANALYSIS AND EVIDENCE [18] There is no issue was to whether the Third Party Claim should be dismissed. Mr. Iqbal and Honda Canada consent to both the main action and the Third Party Claim being dismissed on a without costs basis. The only issue is whether RockTenn is entitled to its costs. [19] Section 131 of the Courts of Justice Act gives the court general discretion to fix costs [^1]. Rule 57 of the Rules of Civil Procedure sets out factors the court should consider in making its determination [^2]. [20] Justice Perell summarized the purposes that costs orders serve in *394 Lakeshore Oakville Holdings Inc. v. Misek* (2010) [^3]. He stated: Modern costs rules are designed to advance five purposes in the administration of justice: (1) to indemnify successful litigants for the costs of litigation, although not necessarily completely; (2) to facilitate access to justice, including access for impecunious litigants; (3) to discourage frivolous claims and defences; (4) to discourage or sanction inappropriate behaviour by litigants in their conduct of the proceedings; and (5) to encourage settlements. (internal citations omitted). [21] Ultimately, in determining the costs to be awarded, the court applies fairness and reasonableness as overriding principles [^4]. In assessing what is fair and reasonable, it does not engage in a mechanical exercise but, rather, takes a contextual approach, applying the objectives described above and the factors set out in Rule 57, and sets a figure that is fair and reasonable in all the circumstances [^5]. Rule 1.04(1.1) requires the court to consider proportionality; that is, the amount of costs ordered should be proportional to the amount of money and other interests at stake in the proceeding [^6]. [22] A party will be relieved from paying costs where their claim contains a bona fide cause of action that is not frivolous or vexatious and where it was justified in commencing the action having regard to the conduct of the third party [^7]. [23] Mr. Iqbal and Honda Canada were justified issuing the Third Party Claim. There was a substantial risk that Ms. Deonath’s claim to the WSIB for benefits would not be successful or would not be resolved within the limitation period for issuing a third party claim. As events unfolded, her claim was not successful until May 2015, a year and a half after August 2013, when the limitation period for issuing a Third Party Claim would have expired. [24] RockTenn’s lawyer acknowledges that even if Ms. Deonath had made her claim to the WSIB immediately upon issuing her Claim, having regard to the initial disposition of her claim, after 5 months, and the appeal period, of a further year and five months, the limitation period would still have expired for issuing a Third Party Claim before Ms. Deonath would have known that her claim to the WSIB would be successful. [25] Based on RockTenn’s lawyer estimate of the full indemnity costs of $5,000 incurred by her client in preparing a Statement of Defence to the Claim and to the Third Party Claim, based on her hourly rate of $345, it would appear that she spent approximately 14.5 hours drafting those pleadings. That amount of time is, on its face, unreasonable, and affords some explanation for why RockTenn brought the present motion for the purpose only of recovering its costs. [26] After receiving the Third Party Claim, RockTenn’s lawyer was as capable of investigating the merits of a possible claim to the WSIB as Ms. Deonath’s lawyer was, and could have suggested an adjournment of the examinations for discovery from the September date when they had been scheduled to take place, and then made a proposal to Ms. Deonath that she apply to WSIB, if she was of the opinion at that time that the exclusive jurisdiction of the WSIB was self-evident. She did not do so, apparently because she considered it to be in her own client’s interests to proceed to discovery before making that proposal. [27] RockTenn’s lawyer acknowledges that it was not until the discovery that it became apparent to their client that a WSIB claim was viable. It was no more unreasonable for Ms. Deonath to wait until the discoveries to make that determination. [28] Mr. Iqbal and Honda Canada assisted Ms. Deonath in making her claim for benefits, which efforts were ultimately successful. RockTenn took no steps to participate in the WSIB application or appeal. Between July 2015 and February 2017, they did not respond to the efforts by the lawyers for Mr. Iqbal and Honda Canada to seek a resolution of the Third Party Claim on a without costs basis. It was unreasonable for RockTenn not to cooperate in these efforts, and unreasonable for it to bring the present motion for the purpose only of seeking its costs of the action. [29] It was unreasonable for RockTenn to bring the present motion, solely for purpose of recovering costs which it had incurred defending the Third Party Claim, the majority of which could have been avoided, and based on an argument that Ms. Deonath failed to take steps that RockTenn’s lawyer also did not take, and that, had they been taken, would not have avoided the Third Party Claim or reduced the costs associated with it. RockTenn, had it acted reasonably, should have consented, as the other parties did, to a dismissal of the Third Party Claim without costs. A motion, brought in these circumstances, makes unreasonable demands on limited judicial resources. ## CONCLUSION AND ORDER [30] For the foregoing reason, it is ordered that: 1. The Third Party Claim is dismissed without costs. 2. RockTenn shall pay the costs of Mr. Iqbal and Honda Canada in this motion, fixed in the amount of $1,500.00 plus H.S.T., within 60 days. --- Price J. Released: June 13, 2017 --- ### Footnotes [^1]: Courts of Justice Act, R.S.O. 1990 c. C.43, section 131 [^2]: Rules of Civil Procedure, R.R.O. 1990, Reg. 194 [^3]: *394 Lakeshore Oakville Holdings Inc. v. Misek*, 2010 ONSC 7238, para. 10 [^4]: *Boucher v. Public Accountants Council for the Province of Ontario* (2004), 71 O.R. (3d) 291 (C.A.); and *Moon v. Sher* (2004), 246 D.L.R. (4th) 440 (C.A.) [^5]: *Gratton-Masuy Environmental Technologies Inc. (c.o.b. Ecoflow Ontario) v. Building Materials Evaluation Commission*, 2003 ONSC 8279 (ON SCDC), [2003] O.J. No. 1658, at para. 17 [^6]: *Patene Building v. Niagara Home*, 2010 ONSC 468 [^7]: *Maida v. Goodmurphy*, 2012 ONSC 222, para. 22