MOTION HEARD: 20170727
REASONS RELEASED: 20170811
SUPERIOR COURT OF JUSTICE – ONTARIO
BETWEEN:
JOANNE MORAIN
Plaintiff
- and -
METROPOLITAN TORONTO CONVENTION CENTRE CORPORATION and CANADA LANDS COMPANY CLC LIMITED
Defendants
- and-
THYSSENKRUPP ELEVATOR (CANADA) LIMITED
Third Party
BEFORE: MASTER D. E. SHORT
COUNSEL: Michael Unea, F (416) 593-7760 -for moving Defendant
M. Gosia Bawolska F (416) 360-1708 -for Third Party
RELEASED: August 11, 2017
Reasons for Decision
I. Overview
1On October 19, 2007 the Plaintiff was walking in the Metropolitan Toronto Convention Centre (“MTCC”) for the purpose of~attending a convention. She was going down the escalator at the Convention Centre when, “suddenly and without warning, the escalator jerked and-came to a complete stop causing the Plaintiff to lose her balance and fall backwards.
2MTTC was sued in 2009 by the plaintiff, on the basis of an allegation that the plaintiff sustained injuries and damages as a result of the escalator failure. The plaintiff alleged negligence and/or breach of statutory duty on the part of the MTTC and that, as such, they were liable to the plaintiff.
3ThyssenKrupp Elevator (Canada) Limited was at all material times responsible for the repair and maintenance of the escalators at the Convention Centre.
4MTTC disputed the plaintiff's claims the particulars of which were plead in its Statement of Defence.
5MTCC then issued a third party claim against ThyssenKrupp in November of 2010 which asserted:
- Without admitting liability to the plaintiff, MTTC states the plaintiff's alleged injuries and/or damages were caused or contributed to by the negligence of ThyssenKrupp.
6However an additional complexity was raised following a review of the contractual arrangements between the two entities. Apparently MTCC entered into a contract with ThyssenKrupp on January 1, 2007 for the repair and maintenance of elevators and escalators at the Convention Centre. (the "ThyssenKrupp Contract"). The pleading asserted:
MTTC states that Clause 13 of the ThyssenKrupp Contract required, inter alia, that ThyssenKrupp obtain liability insurance in MTTC' s name.
Furthermore, MTTC states that Clause 14 of the ThyssenKrupp Contract also provides, inter alia, that ThyssenKrupp shall indemnify and save harmless MTTC for liability which results from ThyssenKrupp's acts, negligence, default, or omission.
MTTC states and the fact is that since receipt of the Statement of Claim it has sought confirmation from ThyssenKrupp that their contract obligations will be met. MTTC further states and the fact is that ThyssenKrupp has failed to meet their obligations thereby causing MTTC to incur time and expense. MTTC states and the fact is that ThyssenKrupp has failed to prove insurance being purchased in MTTC's name and, further, has failed to indemnify and save harmless MTTC despite very clear allegations in the Statement of Claim that fall within the ThyssenKrupp contract provisions.
MTTC claims complete contribution and indemnity from ThyssenKrupp, both at common law and pursuant to the terms of the ThyssenKrupp Contract and, further, damages for Breach of Contract.
7The Third Party Claim of MTCC sought $100,000 for “Breach of Contract” against ThyssenKrupp.
8In October of 2015 MTCC settled the main action with the plaintiff for a sum within the Small Claims Court’s jurisdiction.
9Now, after the action has progressed for 8 years in the Superior Court of Justice, including attendance at a pre-trial and a trial date having been set, the defendant seeks a transfer notwithstanding the Third Party’s objection.
10The defendant did not place any evidence before the court concerning the availability of early trial dates in the Small Claims Court.
11Against that background I therefore turn to the applicable legislation relating to actions in that court.
II. Courts of Justice Act R.S.O.1990.c.C43
12The CJA, with my emphasis added, provides:
23 (1) The Small Claims Court,
(a) has jurisdiction in any action for the payment of money where the amount claimed does not exceed the prescribed amount exclusive of interest and costs; and,
(b) has jurisdiction in any action for the recovery of possession of personal property where the value of the property does not exceed the prescribed amount.
Transfer from Superior Court of Justice
23 (2) An action in the Superior Court of Justice may be transferred to the Small Claims Court by the local registrar of the Superior Court of Justice on requisition with the consent of all parties filed before the trial commences if
(a) the only claim is for the payment of money or the recovery of possession of personal property; and
(b) the claim is within the jurisdiction of the Small Claims Court.
13However the section does not expressly deal with the procedure if there is no consent from the party opposite. The CJA does however set out the limitations on the awarding of costs at that level:
Limit on costs
29 An award of costs in the Small Claims Court, other than disbursements, shall not exceed 15 per cent of the amount claimed or the value of the property sought to be recovered unless the court considers it necessary in the interests of justice to penalize a party or a party's representative for unreasonable behaviour in the proceeding. R.S.0.1990, c. C.43, s. 29; 2006, c. 21, Sched. C, s. 105 (2).
III. Third Party’s Position
14Counsel for the Third Party argues that (as was the case in May v. Hutchinson, 2013 ONSC 7712,) in this action all of the required steps in the litigation have occurred and the matter is at the pre-trial stage. Their factum asserts:
...ThyssenKrupp's defence and overall litigation strategy were created and sustained over the course of this nearly seven year old action with the understanding and reasonable expectation and that the matter was to be tried before the Superior Court of Justice, and that ThyssenKrupp's costs of having to participate in each of the litigation steps would be awarded to ThyssenKrupp in accordance with the authority conferred to that level of court by the Rules of Civil Procedure.
Not only would ThyssenKrupp have employed an entirely different litigation strategy had the Third Party Claim been for under $25,000 and brought before the Small Claims Court at the outset, it would not have been obliged to go through almost seven years of litigation requiring over $60,000.00 in defence costs. To transfer the matter at this late stage after the majority of pre-trial steps have been completed, many of which would have been unnecessary under the Small Claims Court rules, would not ensure the just, most expeditious, and least expensive determination of the issues.
15The fees and disbursements incurred by the Third Party in defending the action to date apparently exceed $60,000.00. These costs would not be recoverable in Small Claims Court as I cannot make an order either fettering or expanding the limited costs jurisdiction of the Deputy Judge. Accordingly the costs can only be awarded if I award them prior to the transfer as a term of my order.
16Master McLeod in Lamarche, infra weighed the undesirability of such an approach which I feel applies equally in this case:
“I could make an order requiring the plaintiff to pay costs to the defendant prior to the transfer taking place and had I made the requested order I would have made that a condition. An appropriate order would be to order complete indemnity because virtually all of the costs incurred in this court would have been wasted. Needless to say, the plaintiff is not enamoured of that idea and should I make that order it would largely eliminate the benefits of transferring the action to Small Claims Court.”
IV. Caselaw
17Assuming that it would be appropriate to transfer a claim to Small Claims Court over the objection of the opposing party [See Ali v. Schrawen 2011 ONSC 2158] I decline to do so in this case. The reasons for my decision follow.
18Justice Pitt in Capano v. Rahm, 2010 ONSC 3241 observed:
[4] It is true that the court may draw on its inherent powers over its own process to transfer an action from one judicial forum to another: see Vigna v. Toronto Stock Exchange, 1998 CarswellOnt 4560 at para. 7 (Gen. Div.). However, the particular facts of this case do not warrant its exercise. Since the action was launched on June 9, 2009, the plaintiffs brought various motions that resulted in much delay. Bearing in mind the general principle animated in Rule 1.04(1), the stage of the proceeding and the availability of simplified procedure, I am not convinced that a transfer to the Small Claims Court would secure the "just, most expeditious and least expensive" determination of the dispute. As further discussed below, the steps remaining until trial are not many. A transfer to the Small Claims Court could further delay resolution of the dispute.”
19Similarly in Lamarche v. INC Insurance Company of Canada, 2012 ONSC 4111 Master Macleod, as he then was, declined to transfer a proceeding to Small Claims Court as, among other reasons, many steps had already been taken in the litigation which would not have been necessary under the Small Claims Court rules, including the preparation of an Affidavit of Documents and mediation. Master Macleod further reasoned that the defendant's choice of counsel and litigation strategy may have been different had the claim been for under $25,000.00 in damages at the outset. Master Macleod also noted that if he had permitted the transfer the fees and disbursements incurred by the defendant in that litigation to date would not be recoverable under the Small Claims Court rules.
20Here I am satisfied that the litigation strategy adopted by the Third Party, including its choice of counsel and the steps undertaken in defence of the claim against it , were reflective of the amount claimed by the plaintiff and the court level which she originally chose. This is a relevant consideration to be considered by the court on a motion such as this. Although the Defendant did not make that initial choice, it did elect to assert its own contractual claim for an additional sum of $100,000.
21I am mindful of and adopt the observations of Justice D. A. Broad in May v. Hutchinson, 2013 ONSC 7712. The defendant here chose to assert a claim of its own in excess of the jurisdiction of the Small Claims Court in its third party claim. In the exercise of a discretion on whether to transfer an action to the Small Claims Court, the court should consider the overall goal expressed in rule 1.04 of securing the just, most expeditious and least expensive determination of every civil proceeding on its merits, and the principle of proportionality.
“The inclusion of the adjective “Just” in Rule 1.04 carries with it a requirement that the process adopted, and the exercise of discretion by the court, must be fair to both sides. It was the plaintiff who chose to claim the amount of damages that she did and to commence her action in the Superior Court and the defendant was entitled, and indeed required, to marshal resources and to adopt a litigation strategy commensurate with the claim and the forum chosen by the plaintiff In the circumstances of this case, it would be unfair to the defendant to effect a transfer to the Small Claims Court simply because the plaintiff has now come to the realization that her true claim for damages is within the jurisdiction of the Small Claims Court and wishes to mitigate her exposure to a possible adverse award of costs in the Superior Court...”
V. Disposition
22in coming to my conclusion in this case, I found persuasive these assertions in the factum filed on behalf of ThyssenKrupp asserts that:
After nearly seven years of litigation and over $60,000.00 in defence costs, this motion has come far too late. ThyssenKrupp has devoted considerable resources defending itself against the Third Party Claim in the Superior Court, including significant time and expense preparing for and attending to the many steps in the litigation that would have been unnecessary in the Small Claims Court
Transferring the matter at this late stage would cause prejudice to ThyssenKrupp, as it would be prevented from recovering its costs thrown away in defending a nearly seven year old action in the Superior Court. Allowing the purported amendment to the Third Party Claim would cause similar prejudice to ThyssenKrupp, as the amendment is in reality a discontinuance of a meritless claim.
MTCC has brought this motion in an attempt to shield itself from a possible adverse cost award in the Superior Court, and not to ensure the just, most expeditious and least expensive determination of the issues. ThyssenKrupp respectfully submits that the court cannot permit this blatant attempt to frustrate the court's processes and procedures which safeguard the court against frivolous actions and unnecessary use of the court's resources, and safeguard defendants against the running up of defence costs in the absence of any evidence to support the claim.
23Counsel further submitted that MTCC's attempt to frustrate the court's processes in an effort to evade adverse costs consequences should attract a penalty of costs on a substantial indemnity basis. I do not accept this proposition. Particularly as there was an offer to abandon the $100,000 breach of contract claim if the transfer to the Small Claims Court could be made on consent.
24The Defendant’s Motion seeking to delete the $100,000 claim was ultimately withdrawn at the hearing before me.
25In determining this motion, I am also mindful of the issue of judicial resources in the Superior Court and the heavy workload of Judges in this court. I add to their workload by keeping this matter in the Superior Court and I do so reluctantly.
26The evidence before me does not satisfy me that a transfer at this late stage would be the most just, expeditious and least expensive determination of the matter remaining at issue and costs.
27The defendant’s motion to transfer is dismissed.
28The Third Party is entitled to its costs of the motion on a partial indemnity basis, which I fix at $6000, payable within 30 days.
R. 197/DS __________________
Master D.E. Short