CITATION: Hawley v. Granger and Gunn & Associates 2017 ONSC 5927

COURT FILE NO.: 602/16

DATE: 20171004

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Russell Hawley, Plaintiff

AND:

Thomas Granger and Gunn & Associates o/b Douglas Gunn Professional Corporation, Defendants

BEFORE: Justice R. Raikes

COUNSEL: Russell Hawley, self-represented

David B. Williams and M. Mana Khami, for the defendants

HEARD: June 30, 2017

ENDORSEMENT

[1] The defendants move for summary judgment on the basis that the plaintiff’s claim is statute barred by operation of s. 4 of the Limitations Act, 2002, S.O. 2002, C. 24, Sch. B.

[2] The plaintiff was involved in matrimonial litigation with his former spouse, Kathy Hawley. The defendant, Thomas Granger, was his lawyer.

[3] The matter came on for trial on September 27, 2013 before Henderson J. in London, Ontario. Before the trial started, Justice Henderson directed counsel to make a further attempt at settlement of the matter as they were then only $10,000 apart. Discussions occurred and hand-written partial minutes of settlement were prepared, signed and presented to the court. The plaintiff then testified so that a divorce could be issued without further delay.

[4] On September 30, 2013, the plaintiff wrote his lawyer to advise that he was willing to make an offer in the amount of $150,000 for the matrimonial home, less the amount owing on the CIBC line of credit of $38,581.10. He also advised that he was prepared to pay Ms. Hawley $3,000 as an equalization payment and $400 for costs. He instructed that the offer was open for acceptance until October 1, 2013.

[5] On October 3, 2013, Ms. Hawley made an offer to settle through her lawyer by which the plaintiff would pay her $53,400 comprised of $50,000 for her interest in the matrimonial home, $3,000 for equalization and $400 for costs. Under her proposal, the plaintiff would be solely responsible for the line of credit.

[6] On October 4, 2013, the plaintiff signed a Notice of Acceptance of Offer to Settle by which he accepted the offer of October 3, 2013. The document was forwarded to Ms. Hawley’s lawyer the same day.

[7] On October 16, 2013, a final order was entered in accordance with the hand-written minutes of settlement from September 27, 2013 which required, inter alia, that the plaintiff pay Ms. Hawley $3,000 for equalization of net family property from the proceeds of sale of the matrimonial home.

[8] The terms of the settlement were carried out on October 16, 2013. Ms. Hawley received a cheque for $53,400 and another cheque for $38,575.45 payable to the bank for the line of credit.

[9] The plaintiff alleges that his lawyer failed to adequately protect his interests on equalization of matrimonial property. He denies that he signed the minutes of settlement on September 27, 2013 or that he agreed to same. He contends that his lawyer met privately with his ex-spouse’s lawyer and they hammered out a deal without his input or instruction.

[10] He also alleges that he brought to his lawyer’s attention facts that demonstrated that Ms. Hawley’s Net Family Property statement was inaccurate – that she was fraudulently claiming assets that never belonged to her. He maintains that had Mr. Granger taken those items into account, she would have owed him an equalization payment.

[11] On November 25, 2013, the plaintiff wrote to Mr. Granger taking issue with the settlement. He wrote that Ms. Hawley actually owed him $10,413.15 plus the $3,000 he had paid to her. He wanted to know who was responsible to pay him that amount.

[12] The plaintiff wrote a note to Mr. Granger, received December 3, 2013, that Mr. Granger would have to prove that he [the plaintiff] signed “any agreement”.

[13] Mr. Granger wrote to Mr. Hawley on December 10, 2013 to explain and reiterate the terms and rationale for the settlement to which the plaintiff had agreed.

[14] On December 16, the plaintiff called Mr. Granger’s office with threats that he would sue Mr. Granger, Ms. Hawley and her counsel. He accused Mr. Granger of fraud.

[15] On December 17, 2013, the plaintiff called Mr. Granger’s office and again denied that he had signed the minutes of settlement. He asserted, as he does in this action, that Mr. Granger signed his name; that Mr. Granger met privately with Ms. Hawley’s lawyer and told him a settlement was reached.

[16] Mr. Hawley made a formal complaint against Mr. Granger to the Law Society of Upper Canada. His initial complaint was in the form of a letter to the Law Society which is date stamp received on January 10, 2014. A completed Complaint Form was received by the Law Society on February 7, 2014. That form was signed by Mr. Hawley on February 3, 2014.

[17] A close review of that complaint shows that Mr. Hawley raised substantially the same issues in the complaint that he asserts against the defendants in this action.

[18] Mr. Hawley refused to pay Mr. Granger’s final account and an assessment took place on April 2, 2014. Mr. Hawley was ordered to pay and did pay under protest the amount owing.

[19] The statement of claim in this action was issued March 2, 2016.

Law

[20] Summary judgment motions are governed by r. 20.04 which states:

(2) The court shall grant summary judgment if,

(a) the court is satisfied that there is no genuine issue requiring a trial with respect to a claim or defence;…

(2.1) In determining under clause (2) (a) whether there is a genuine issue requiring a trial, the court shall consider the evidence submitted by the parties and, if the determination is being made by a judge, the judge may exercise any of the following powers for the purpose, unless it is in the interest of justice for such powers to be exercised only at a trial:

1. Weighing the evidence

2. Evaluating the credibility of a deponent

3. Drawing any reasonable inference from the evidence.

(2.2) A judge may, for the purposes of exercising any of the powers set out in subrule (2.1), order that oral evidence be presented by one or more parties, with or without time limits on its presentation.

[21] The leading case on summary judgment is Hryniak v. Mauldin, 2014 SCC 7. At para. 66, Karakatsanis J. for the court wrote:

On the motion for summary judgment under Rule 20.04, the judge should first determine if there is a genuine issue requiring trial based only on the evidence before her, without using the new fact-finding powers. There will be no genuine issue requiring a trial if the summary judgment process provides her with the evidence required to fairly and justly adjudicate the dispute and is a timely, affordable and proportionate procedure, under Rule 20.04(2)(a). If there appears to be a genuine issue requiring a trial, she should then determine if the need for a trial can be avoided by using the new powers under Rules 20.04(2.1) and (2.2). She may, at her discretion, use those powers, provided that their use is not against the interest of justice. Their use will not be against the interest of justice if they will lead to a fair and just result and will serve the goals of timeliness, affordability and proportionality in light of the litigation as a whole.

[22] Thus, the judge hearing the summary judgment motion must ask:

1. On the basis of the evidentiary record alone, are there genuine issues that require a trial?

2. Does the evidentiary record provide the evidence needed to “fairly and justly adjudicate the dispute”?

[23] In Hryniak, the test for summary judgment was stated at para. 49 as follows:

There will be no genuine issue requiring a trial when the judge is able to reach a fair and just determination on the merits on a motion for summary judgment. This will be the case when the process (1) allows the judge to make the necessary findings of fact, (2) allows the judge to apply the law to the facts, and (3) is a proportionate, more expeditious and less expensive means to achieve a just result.

[24] The onus of establishing that there is no genuine issue requiring a trial rests on the moving party. Where the moving party establishes that there is no genuine issue requiring a trial, the onus shifts to the responding party to establish that there is a genuine issue requiring a trial: Sweda Farms Ltd. v. L.H. Gray & Son Ltd., 2014 CarswellOnt 11926 (ON CA) at para. 26; New Solutions Extrusion Corp. v. Gauthier, 2010 ONSC CarswellOnt 913 at para. 12; Bhakhri v. Valentim, 2012 ONSC 2817 at para. 7.

[25] A responding party must set out in affidavit material or other evidence the specific facts that establish that there is a genuine issue requiring a trial. The responding party cannot rest on mere denials of allegations of a party’s pleading: Sweda, para. 27 (See also John Deere Financial Inc. v. 1232291 Ontario Inc. (c.o.b. Northern Haul Contracting), [2015] O.J. No. 6503 (S.C.J.) at para14; O’Laughlin v. Byers, [2014] O.J. No. 4221 (S.C.J.) at para. 40, upheld [2015] O.J. No. 1559 (C.A.). It is not enough to allude to evidence that may be adduced in the future.

[26] The judge hearing the motion must:

1. Determine the motion on the pleadings and evidence actually before the court on the motion. The judge is entitled to assume that the record contains all the evidence that would be adduced at trial; and

2. Take a hard look at the evidence and the merits of the action at this preliminary stage: Sweda, paras. 26-28.

[27] The applicable limitation period is two years pursuant to s. 4 of the Limitations Act, 2002, S.O. 2002, c. 24, Sched. B. The limitation period starts to run from the day on which the claim was discovered.

[28] The applicable principles to fix the date of discovery of the claim are set out in s. 5 of the Limitations Act, 2002. S. 5 states:

5. (1) A claim is discovered on the earlier of,

(a) The day on which the person with the claim first knew,

(i) that the injury, loss or damage had occurred,

(ii) that the injury, loss or damage was caused by or contributed to by an act or omission,

(iii) that the act or omission was that of the person against whom the claim is made, and

(iv) that, having regard to the nature of the injury, loss or damage, a proceeding would be an appropriate means to seek to remedy it; and

(b) The day on which a reasonable person with the abilities and in the circumstances of the person with the claim first ought to have known of the matters referred to in clause (a).

(2) A person with a claim shall be presumed to have known of the matters referred to in clause (1) (a) on the day the act or omission on which the claim is based took place, unless the contrary is proved.

[29] In Fennell v. Deol, 2016 ONCA 249, Justice van Rensburg for the Court wrote at para. 20:

The basic two-year limitation begins to run on the day the claim was discovered. The date of discovery is the earlier of the two dates under s. 5(1) – when (a) the person with the claim had knowledge of, or (b) a reasonable person with the abilities and in the circumstances of the person with the claim first ought to have had knowledge of, the matters referred to in s. 5(1)(a)(i) to (iv). If either of these dates is more than two years before the claim was issued, the claim is statute-barred.

[30] Whether a person has discovered a claim is a factual determination. The plaintiff need not be certain of success or even have all of the facts in his or her possession. It is sufficient if the plaintiff knows enough facts on which to base a claim against the defendant. If so, the limitation period is triggered and begins to run: Lawless v. Anderson, 2011 ONCA 102, cited in Lima v. Moya, 2015 ONSC 324 at para. 69. As Master Haberman stated in Lima at para. 71:

Further, while new information may emerge down the road that strengthens the case against the proposed defendant, this will not restart the clock. A plaintiff should not wait until he has a good case against a defendant before starting a claim against him – as long as he has a case he can try to make, he must move within the limitation period.

Analysis

[31] The crux of the plaintiff’s claim against the defendants is set out at paras. 7 and 8 of the statement of claim. The letter sent by Mr. Hawley to the Law Society on January 9, 2014 and the complaint which he acknowledges signing on February 3, 2014 mirror the allegations of misfeasance against Mr. Granger in this action. They are essentially the same allegation made in late November and early December 2013.

[32] The evidence establishes that:

1. Mr. Hawley knew on September 27, 2013 that a partial settlement had been negotiated by Mr. Granger. This was communicated to the court before he took the stand to testify.

2. Mr. Hawley knew by early October 2013 (and arguably sooner) that he was to pay Ms. Hawley $3,000 by way of equalization.

3. By November 25, 2013, Mr. Hawley disputed the settlement and took the position that Ms. Hawley owed him for equalization.

4. Mr. Hawley denied executing the minutes of settlement as of December 3, 2013.

5. Mr. Hawley received a letter from his lawyer in December 2013 that made clear that a settlement existed, its terms, and that Mr. Granger was asserting that he had acted in accordance with Mr. Hawley’s instructions.

6. Mr. Hawley threatened to sue Mr. Granger in December 2013 because of the settlement and the obligation to pay Ms. Hawley when, in his mind, she should be paying him.

7. Mr. Hawley communicated his refusal to pay Mr. Granger’s final account because he was upset over these matters in early February 2014.

8. Mr. Hawley complained to the Law Society in January and by complaint signed February 3, 2014 about the very same concerns that underlie his claim in this action.

[33] In my view, Mr. Hawley was aware as early as October 2013, and certainly by no later than February 3, 2014, of the material facts giving rise to the claim against Mr. Granger. He knew that a loss or damage had occurred – the settlement with and payment to Ms. Hawley. He knew that that loss or damage was caused by Mr. Granger whom he blamed at the time. He acknowledged as much in oral submissions.

[34] Further, I am satisfied that the evidence clearly establishes that Mr. Hawley knew that a proceeding against Mr. Granger and his firm was an appropriate remedy by then; in fact, he threatened litigation in December 2013. Mr. Hawley offers no real explanation for the delay in commencing this action. He vaguely suggests that he did not have “all the facts” until April 2, 2014, the date of the assessment of Mr. Granger’s account. Even if so, Mr. Hawley had sufficient material facts necessary to ground a claim.

[35] I find that there is no genuine issue requiring a trial. The plaintiff’s own correspondence amply demonstrates his discovery of the cause of action. The plaintiff’s claim is barred by s. 4 of the Limitations Act, 2002. It was commenced more than two years after he “discovered” the claim.

[36] To be clear, I find that Mr. Hawley had actual knowledge pursuant to s. 5(1)(a) of the Limitations Act, 2002. I would also find, were it necessary to do so, that a reasonable person in Mr. Hawley’s circumstances with his abilities ought to have known of the matters in s. 5(1)(a) by November 2013, well before the letter to the Law Society.

Conclusion

[37] Given my findings above, the plaintiff’s action is dismissed. If the parties cannot agree on costs, they may make written submissions not exceeding 3 pages within 15 days of release of this decision.

“Justice R. Raikes”

Justice R. Raikes

Date: October 4, 2017