CITATION: Adjey v. Chickery, 2017 ONSC 794

COURT FILE NO.: CV-16-4463-00SR

DATE: 2017 02 01

ONTARIO

SUPERIOR COURT OF JUSTICE

B E T W E E N:

DAVID ADJEY

Ethan Rogers, for the Plaintiff

Applicant

• and -

CHICKERY HOLDING, LLC

David Whitten and Simone Ostrowski, for the Defendant

Respondent

HEARD: January 20, 2017

Ruling on Motion to Strike

Justice Thomas A. Bielby

1The Applicant seeks an order striking paragraphs 35-38, 41, 43, 44, and 47 of the Affidavit of David Bogorad, sworn November 11, 2016 (the “Affidavit”), an affidavit relied upon by the Respondent. Mr. Bogorad is the Respondent’s Chief Financial Officer.

FACTS AND OVERVIEW

2The Applicant was an employee of the Respondent and his employment began on June 1, 2014. His employment was terminated, allegedly for cause, on July 22, 2016.

3The parties entered into an employment contract (the “Contract”) in May, 2014. The Contract was drafted by the Respondent and the following was set out therein, at paragraph 3(i):

The company will pay the employee an annual gross base salary of $60,000 (CDN) less statutory deductions; provided that this base salary shall not be effective until the company closes private placement or placements of its securities.

4The parties agree that on November 25, 2015, the respondent “closed its private placement”.

5In these proceedings, commenced by application, the Applicant seeks an interpretation of paragraph 3(i) and submits the correct interpretation would result in the Respondent owing salary to the Applicant for the period commencing June 1, 2014 and ending November 23, 2015, which salary was withheld pending the closing of the private placement.

6Accordingly, the Applicant alleges he is owed $88,767.12.

7The paragraphs in issue in the Affidavit allege that the Applicant is guilty of sexual harassment and insubordination which the Respondent alleges were sufficient to terminate the Applicant’s employment.

8As another reason for termination, the Respondent also alleges that the Applicant refused to complete his duties under the Contract by failing to produce new, low cost recipes for the respondent.

ARGUMENTS OF THE PARTIES

THE APPLICANT

9The Applicant submits that the paragraphs in issue are scandalous, frivolous and vexatious. It is submitted that this case is not one of wrongful dismissal but rather a claim for damages for unpaid wages. It is submitted that the paragraphs in issue go to the issue of the Applicant’s dismissal and are irrelevant to the subject matter of the application.

10The application is brought pursuant to Rule 14.05 (d) and/or (h), and calls for an interpretation of a contract and/or makes a claim for which there is unlikely any material facts in dispute.

11In regards to the motion before me the Applicant relies on Rule 25.11 which reads:

The court may strike out or expunge all or part of a pleading or other document, with or without leave to amend, on the ground that the pleading or other document,

(a) may prejudice or delay the fair trial of the action;

(b) is scandalous, frivolous or vexatious; or

(c) is an abuse of the process of the court.

12Rule 38.12, enacted in 2014, reads as follows:

Rule 25.11 applies, with necessary modifications, with respect to any document filed on an application.

13The Applicant also relies on Rule 39.01 (5), in regards to affidavits filed in support or in response to applications. It reads,

An affidavit for the use on an application may contain statements of the deponent’s information and belief with respect to facts that are not contentious, if the source of the information and the fact of the belief are specified in the affidavit.

14With respect to the Contract, the Applicant submits that pursuant to paragraph 3(i) and Appendix A of the Contract, he had no duties or obligations in regards to the closing of the placement of securities. He also relies on paragraphs 10-12 of the Contract.

15Paragraph 10 of the Contract is entitled, “Termination”. The Affidavit speaks of termination with cause and this paragraph states that if such termination takes place, the Applicant is still entitled to unpaid salary.

16The Applicant relies on paragraphs 11 and 12 of the Contract in his submission that the Contract represents the whole of the employment agreement between the parties.

17In this regard he relies on Gutierrez v. Tropic International Ltd. [2002] O. No. No. 3079.

18In regards to the interpretation of section 3(i) of the Contract, it is submitted by the Applicant that this section can only be interpreted in a manner consistent with the Employment Standards Act of Ontario (the Act). Pursuant to the Act, there is no contracting out of any employment standards (s. 5). In short, the Act trumps the Contract.

19Clearly the issues involving the applicability of the Act and the interpretation of the Contract are matters for the judge hearing the application.

20In regards to the striking of paragraphs in an affidavit, the Applicant relies on the authority, Belokon v. Kyrgyz Republic 2015 CarswellOnt 14584, a decision of W. Matheson J. of the Ontario Superior Court of Justice and in part, dealt with a motion to strike out paragraphs in an affidavit filed in response to an application. It was submitted that the affidavit was prejudicial to a fair hearing, an abuse of process and was scandalous, frivolous and vexatious.

21From paragraphs 22 and 23 I quote,

Generally, issues regarding the admissibility of affidavits filed on an application should be dealt with by the judge hearing the application, at the time.

The parties agree that this general rule is subject to an exception, which is described in the Republic’s factum as follows:

[34] The general rule under Rule 25.11 with respect to affidavits is subject to the following exception. An affidavit, or parts of an affidavit, will be struck out where the material is clearly scandalous vexatious such as where it is clearly irrelevant and impugns the behaviour of the party. Only in such clear instances will the court intervene in advance of the application.

22From paragraph 25, I quote,

Where an affidavit is clearly irrelevant and seriously impugns the behaviour of the opposite party, it places that party in the invidious position of having to decide between responding to the irrelevant material with further irrelevant material or leaving serious allegations of misconduct unanswered on the record.

23The Applicant, in the matter before me, submits that the portions of the Affidavit in issue are clearly irrelevant. They speak to the issue of termination with cause and the Applicant is not making a claim for damages for his termination. He seeks monies owed to him for a period of time before his termination. Therefore, it is submitted, that the offending paragraphs are scandalous and vexatious and impugn the character of the Applicant.

24The Applicant submits that his claim for relief is in respect to the interpretation of one paragraph in the Contract and there are no claims for relief made on behalf of the Respondent which would result in the relevancy of any evidence in regards to dismissal with cause.

25The Applicant also relies on the authority, New Tecumseh (Town) v. Weatherall 2010 CarswellOnt 5728, which, in part, dealt with a request that a number of paragraphs in an affidavit, filed in response to an application, be struck. In regards to one such paragraph, DiTomaso J., at paragraph 52 states,

Again the impugned sentences appear for the purpose of embarrassing Cablebridge. I find that the impugned sentences are scandalous in that they are intended to prejudice Cablebridge. They are intended to describe Cablebridge in most unflattering terms as a party that would use it greater financial power and strength to oust its smaller and weaker opponent namely the Weatherall group.

26The Applicant submits, in the matter before me, the offending paragraphs are intended to embarrass the Applicant.

27The applicant submits that some of the paragraphs in issue violate Rule 39.01(5) in that they do not disclose the source of the information upon which the deponent’s information and belief and/or deal with contentious matters.

28In Cameron v. Taylor 1992 CarswellOnt 3360, the respondent sought to strike paragraphs in the affidavits of the applicant on the grounds that such paragraphs contain statements of the deponent’s information and belief on contentious issues and fail to set out the source of the information and the fact of the belief, contrary to Rule 39.01(5).

29The court, in a summary of the law stated that the failure to state the source of the information and belief in an affidavit is not merely a technicality but in relation to non-contentious matters can be saved through the application of rule 1.04 (para. 24).

30Aker Biomarine AS et al. v. KGK Synergize Inc. 2013 ONSC 4897 is another authority on Rule 39.01(5), and from paragraph 10 I quote,

Violations of Rules 4.06(2), 39.01(4) and 39.01 (5) are not mere technicalities or irregularities that may be cured or waived. To the contrary, where it is clear in law that evidence is inadmissible, leaving it on the record is embarrassing and prejudicial to the fair hearing of the motion or the application. Evidence tendered in violation of the rules of evidence and Rule of Civil Procedure therefore must be regarded as worthless, and should not be considered; e. g., by the court refusing to receive the affidavit, striking the relevant paragraphs from the offending affidavit, and/or by the court otherwise paying no regard to the evidence.

31The Applicant submits that in accordance with such dicta certain paragraphs of the Affidavit in issue ought to be struck.

32In regards to the submissions of counsel for the Respondent that the Contract has been repudiated, the Applicant submits that the Respondent would need to bring its own action and, nevertheless, the position taken by the Respondent violates the Act.

THE RESPONDENT

33The Respondent submits that the application is to be argued in July, 2017 and reminds the court that on this motion we are not dealing with the merits of the application.

34The Respondent submits that rulings as to the admissibility of portions of an affidavit should be left to the judge determining the application, who will have the benefit of a full evidentiary record.

35One of the authorities relied upon by the Respondent is Zeitler v. Inmet Mining Corp. [2011] O. J. No. 5022 which involved a motion to strike out portions of an affidavit filed by the applicant. The paragraphs in issue were argued to be irrelevant and inadmissible and violated the parole evidence rule. From paragraph 7 I quote,

“…Rulings as to what evidence may be admitted in a case involving the interpretation of a contract ought to me made by the judicial officer charged with the resolution of the main issue. That judge will have all the facts and will be best placed to determine whether the language is ambiguous and whether to turn for help to one or more of the kinds of extrinsic evidence which may be available. Adopting this course means that the disputed evidence will be available in the affidavits for appellate review and will avoid the fragmentations, cost and delay of interlocutory proceedings and possible appeals.”

36Another authority relied upon is, Foster Wheeler Canada Ltd. v. MBB Power Services Inc. [2007] O. J. No. 981, a decision of J.W. Quinn J., and involves a motion to strike certain paragraphs of an affidavit filed on behalf of the respondent in response to a proceeding commenced by application. The court ruled that Rule 25.11 did not provide the necessary authority to hear the motion (para. 8). An action, as referenced in Rule 25.11 (a), is not an application (This interpretation of the applicability of R. 25.11 to affidavits filed further to a proceeding commenced by application has now been addressed via the implementation of Rule 38.12).

37The court goes on to say however that it has an inherent power to consider the issues before it and noted the general principle that the striking of paragraphs in an affidavit should be left to the judge hearing the application.

38The decision in Neighbourhoods of Windfields Limited Partnership v. Death [2007] O. J. No. 3042 involved a motion to strike portions of an affidavit. Commencing at 31 I quote,

I am inclined to the view that one cannot create many principles of general application in this area and that each case must be considered in its own context.

In the context of this application I start with the observation that we are not dealing with an attempt to strike a pleading but rather an attempt to remove form the record evidence which the moving parties claim should not be before the courts on the hearing on the merits.

I accept the general view expressed above that evidence should not be struck on an interlocutory basis unless there is some special reason to do so. The underlying rationales for this view which I glean from the cases are applicable here:

(a) To grant relief on such a motion will encourage more such motions and simply create extra cost and delay;

(b) There is no need to make such rulings because the judge who will hear the merits will be in an equally good or better position to determine admissibility;

(c) It is an inherent part of our judicial process that judges frequently learn of, but disregard, inadmissible evidence and are presumed not to take into account;

(d) In addition, the judge hearing the merits can sanction any inappropriate introduction of evidence by disregarding it and awarding costs.

These rationales warrant my not granting relief with respect to most of the evidence targeted by these motions.

39From paragraph 37 I quote,

In my view a special reason which in some cases might warrant granting relief on motions such as those before me is that two factors are present: the impugned material is clearly inappropriate, and that if the moving parties chose to respond to it nevertheless, to do so would entail unreasonable effort or cost or would result in further voluminous material being filed.

40The Respondent, in the matter before me, argues that the facts within the Affidavit set out another side of the story. It is not a matter of simple contract but rather there was a condition precedent to be satisfied before wages would be paid and that the Applicant had to assist in raising monies for the Respondent.

41It is submitted that whether or not a court can go outside of the agreement is a matter for the judge hearing the application. On this point I am in agreement with counsel for the Respondent.

42The Respondent also argues that the Contract has been repudiated by the Applicant because of his failure to complete his duties and he is guilty of sexual harassment.

43By sexually harassing employees the Applicant, it is submitted, breached the Occupational Health and Safety Act.

44The Respondent submits that paragraphs within an affidavit filed in response to an application ought not to be struck unless clearly inappropriate. There is some relevance to the paragraphs in issue and will not result in further voluminous material.

ANALYSIS

45In considering this motion I must keep in mind I am not sitting in judgment as to whether or not the Contract represents the complete terms of the Applicant’s employment or whether other arrangements or agreements were in play. I am not considering the alleged breaches of legislation.

46In regards to the 25.11 argument, Rule 38.12, in my view, was added to make it very clear that Rule 25.11 is equally applicable to affidavits filed in support or in response to an application.

47I accept that as a general rule, issues regarding the admissibility of evidence, in this case, paragraphs in an affidavit, ought to left to the judge hearing the application. However, there are exceptions to this rule and in that regard I agree with the dicta in the Belokon and the New Tecumseth cases. If the paragraphs in issue are clearly irrelevant and impugn the behaviour of the Applicant, perhaps for the purpose of embarrassing the Applicant, they can be struck as scandalous and vexatious.

48I have also had regard to, Sierra Club Canada v. Ontario (Ministry of Natural Resources) 2011 CarswellOnt 5889 which dealt with an application for judicial review. At the commencement of the three-day hearing before the Divisional Court the respondent brought a preliminary motion to strike certain affidavits or portions thereof.

49The court took issue with the timing of the motion. The court took issue with a failure to define the appropriate record before the court before the hearing (para. 8). The court also stated that is should not be asked at the outset of the hearing to edit documents to extract references to inadmissible evidence (para. 10).

50I have also had regard to the case of Allianz Global Risks U.S. Insurance Co. v. Canada (Attorney General) 2016 CarswellOnt 498, a decision of Master McLeod.

51The Master posed the question, “Under what circumstances should the court entertain a motion to strike out an affidavit in advance of a main motion?” (para. 2). The court also noted that striking an affidavit is different from striking a pleading because an affidavit is part of the evidentiary record (para. 11).

52From paragraph 12 I quote,

“On the one hand courts are generally reluctant to deal with issues of admissibility and relevance in advance of a hearing on the merits and the court must take care not to usurp the role of the court that will consider the merits. On the other hand defining the record appropriately in advance of the hearing enhances the ability of the court to focus on the merits.”

53From paragraph 18, I quote, “One ‘special reason’ to strike an affidavit in advance of the main motion might be where the affidavit is clearly improper and it inevitably given rise to extraordinary cost or difficulty for the other party.”

54The paragraphs in issue in the Affidavit follow the sub-heading, “Termination of the Employment Agreement for Cause”. The title alone raises a red flag as this is not a proceeding for wrongful dismissal. It is a proceeding to recover salary said to be earned prior to termination.

55The various dates set out in the paragraphs in issue, are points in time, subsequent to the period for which the Applicant submits salary was withheld.

56The Affidavit takes issue with the conduct of the Applicant and his failure to complete duties. It certainly impugns the Applicant’s character and may be meant to embarrass the Applicant.

57The Respondent has made no claim for relief. The Affidavit was made in response to the Applicant’s claim and in part quite properly, includes evidence in response to the Applicant’s claim and interpretation of s. 3(i) of the Contract.

58However, in my opinion, the paragraphs in issue, 35-38, 41, 43, 44, and 47 are clearly irrelevant to the extent necessary to make an exception to the general rule. The paragraphs address issues outside the scope of the application. Further, they are not in support of a cross-application or claim of any kind by the Respondent suggesting somehow that even if section 3(i) is interpreted in favour of the Applicant, the amount of salary in issue is still not owing as a result of the Applicant’s behaviour and failure to complete his duties.

59The evidence contained in the paragraphs may or may not amount to grounds for termination of employment for cause but they do not have any relevance to the interpretation of section 3(i) of the Contract and as noted, the grounds post-date the period for which compensation is sought.

60It is in the interests of justice to remove said paragraphs to assist in defining the record to be placed before the judge hearing the application.

61Pursuant to Rules 25.11 and 38.12, paragraphs 35-38, 41, 43, 44 and 47 of the Bogorad affidavit, sworn November 11, 2016 are struck without leave to amend.

62In regards to Rule 39.01(5), paragraphs 35 to 37 and 41 of the Affidavit violate this rule. The information therein is hearsay and they do not set out the deponent’s information and belief and/or do not relate to uncontentious facts.

63For these reasons alone, paragraphs 35-37 and 41 could be struck.

64If the parties cannot agree on costs, submissions in writing may be made and are to be three pages in length, double spaced, together with a Bill of Costs. The Applicant’s submissions are to be made within 21 days of the release of this ruling and the Respondent’s 10 days after receipt of the Applicant’s submissions.

Bielby J.