CITATION: Kyles v. MBNA Mastercard Canada., 2017 ONSC 5037

COURT FILE NO.: CV-15-536491

MOTION HEARD: 13062017

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Debra Kyles, Plaintiff, Responding Party

AND:

MBNA Mastercard Canada, Defendant/Moving Party

BEFORE: Master P. T. Sugunasiri

COUNSEL: Laurion, R., Counsel for the Defendant /Moving Party

Kyles, D., Self-Represented Plaintiff/Responding Party

HEARD: June 13, 2017

REASONS FOR DECISION

[1] This is a motion brought by MBNA Mastercard Canada (“MBNA”) to set aside the noting of default such that it can defend the action. Despite the diligence of Ms. Kyles in pursuing her claim and the negligence of MBNA in responding to her in a timely manner, it is in the interests of justice to allow MBNA to defend this action such that it may be resolved at an early stage or adjudicated on the merits. I set out the reasons below.

Facts:

[2] The action arises out of a dispute between Ms. Kyles and MBNA regarding payment of her credit card account. In Ms. Kyles’ view, she had made a payment arrangement with the company which the company was in breach of.

[3] Ms. Kyles issued the Statement of Claim (“Claim”) in or around September of 2015. She then made extensive attempts to effect proper service on the Defendant. As noted in the Rules of Civil Procedure, proper service on a corporation requires a Plaintiff to leave a copy of the Claim with an officer, director or agent of the corporation, or leave it with a person at the place of business. In this case, MBNA only exists online and Ms. Kyles had significant difficulty serving MBNA.

Ms. Kyles’ Extensive Service Attempts

[4] First Ms. Kyles conducted a business search which revealed no physical address for the corporation. Then she called MBNA customer service and was advised that MBNA Canada only had a P.O. Box for mail delivery. Ms. Kyles then searched the internet, but to no avail. She then entered into a “live chat” with Pablo, an online “Application Specialist”. Ms. Kyles’ frustration with that process is palpable. The transcript of the discussion is as follows:

Pablo: Hello, I am here to assist you today. May I have your name please?

You: Hello. I need a physical address for MBNA in Ontario, not a postal box.

You: Please tell me the address of the MBNA in Toronto, not the postal box.

You: I need an address for MBNA in Toronto, not the postal box.

You: I have to make a delivery

You: Are you there

Pablo: Just to conform, may I please know, for what delivery purpose you are looking for?

You: I need to deliver documents

Pablo: To help you better, may I please know what kind of document? And for what purpose?

You: are you there

You: hello – are you there

You: It is a statement of claim

You: are you there

Pablo: Thank you for conforming!

You: I think you mean confirming with an i

Pablo: Well, you need to send those to below mentioned address:

Pablo: MBNA, P.O. Box 4369, Station A, Toronto, ON M5W 3P2

You: That is a postal box and I need to have a name of a person receiving the document

You: are you there

Pablo: Yes, I am here.

You: I am required to leave it with a human being.

Pablo: In this case, I would suggest you call our customer service number 1-888-876-6262 they have access to check on your account.

You: I don’t need anyone to check on my account

You: I need an address to deliver documents to a human being in MBNA as I told you 10 minutes ago

Pablo: Yes, I can really understand your concern.

You: what is the address

Pablo: But we do not have any physical mailing address.

You: I don’t want a physical mailing address as I told you I have to deliver it to a human being

You: are you there

You: hello

Pablo: Please give me a minute or two

Pablo: I am really sorry, I am not able to locate any physical address for sending documents.

You: I don’t want a location to send anything.

You: I want a location where there are people

Pablo: I would request you call our toll free number 1-888-876-6262 and check with our customer service team, if they can provide a physical address to send documents.

Pablo: It was my pleasure to help you, is there anything else I may assist you with?

[5] On September 15, 2015, Ms. Kyles mailed the Claim to MBNA at its P.O. Box address. On October 29, 2015 Ms. Kyles noted MBNA in default. Unfortunately, what Ms. Kyles should have done was to first obtain an order for substituted service of the Claim, given her difficulties in effecting personal service. However in addition to being self-represented, she was dealing with personal and family illness and I give her some leeway in that regard.

[6] MBNA states that they did not learn of the Claim until March 28, 2016. Ms. Kyles’ uncontroverted evidence, however, indicates the contrary. Kyles was in constant touch with various customer service representatives from October of 2015 to January of 2016, when one agent admitted that she had the Claim but had misplaced it.

[7] While the noting in default may have been hasty on the part of Ms. Kyles, knowing, by her own evidence, that the Claim did not come to the attention of anyone until at least October or more clearly, in January of 2016, it took MBNA almost 10 months from March 28, 2016 to December 8, 2016 to address the Claim and appoint outside counsel.

[8] This inordinate delay caused Ms. Kyles great personal distress and uncertainty through no fault of her own. MBNA seems to simply have no published process by which a plaintiff can properly serve them and receive a timely response. Even in bringing this motion, MBNA still fails to provide information on the appropriate route to be followed. The affidavit in support of its motion simply says “as a result of inadvertence, the Materials likely had not been escalated to the appropriate individual(s) in April 2016…” One can understand Ms. Kyles’ frustration with the process thus far.

[9] Nevertheless, the test for setting aside a noting in default is straightforward and has a low threshold (Metropolitan Toronto Condominium Corp. No. 706 v. Bardmore Developments Ltd., 1991 7095 (OCA)). It requires the Court to look at the behaviour of the plaintiff and defendant, the length of the defendant’s delay, the reasons for delay and the complexity and value of the claim involved.

[10] In the present case, once outside counsel was retained, counsel acted fairly quickly to move to set aside the noting in default. Counsel was retained in December and by February, she attempted to resolve the noting in default issue with Ms. Kyles. Understandably, after her experience with MBNA, Ms. Kyles would not consent to the setting aside of the noting in default. MBNA’s explanation for the delay, though questionable, is in the range of reasonable explanations a party could offer. The Court and Ms. Kyles may not be happy with MBNA’s “inadvertence” but it is, nevertheless a valid reason for the purposes of the test.

[11] On balance, there is a clear dispute as to whether or not Ms. Kyles entered into a payment arrangement with MBNA and as such, there is prima facie merit to MBNA’s proposed defence. This matter should be adjudicated on its merits, or more preferably, have early resolution, once MBNA delivers its defence.

[12] Given the foregoing, I order as follows:

a. The noting in default of MBNA Mastercard Canada is hereby set aside;

b. MBNA shall deliver its defence within 30 days from the date of this Order;

c. There shall be no award as to costs.

“Master P. Tamara Sugunasiri”

Date: August 24, 2017