COURT FILE NO.: CV-15-00527813 DATE: 20180627 SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Kingston Cato, Plaintiff/Responding Party AND: Grzregorz Wojcik, Defendant/Moving Party
BEFORE: H. McArthur J.
COUNSEL: Nadia Condotta appearing as counsel for the Plaintiff/Respondent Julia Wilkes appearing as counsel for the Defendant/Moving Party
HEARD: June 19, 2018
Endorsement
Introduction
1Grzregorz Wojcik provided legal advice to Kingston Cato in 2009. The advice related to Mr. Cato’s transfer of his home to a company owned by his son. In 2010, Mr. Cato sued his son, claiming he had been duped into transferring the home. He did not sue Mr. Wojcik. In 2015, after the matter with his son had settled, Mr. Cato brought an action against Mr. Wojcik, alleging that he provided negligent advice, which caused Mr. Cato to unnecessarily incur legal fees in the matter against his son.
2Mr. Wojcik now brings a motion for summary judgment to dismiss the action brought by Mr. Cato on the basis that it was started outside of the two-year limitation period. Mr. Cato counters that the limitation period did not start until he discovered how much he would owe in legal costs, which was not until the matter with his son settled in 2014.
3For the reasons that follow I find that this is an appropriate case for summary judgment. Mr. Cato discovered all of the material facts upon which he now relies in his action against Mr. Wojcik by November 2010 at the latest. There is thus no genuine issue requiring trial. This action should be dismissed as it is barred by the two year-limitation period.
4At the outset, I will provide a brief overview of the facts. I will then address the applicable legal framework for summary judgment motions, before turning to my analysis.
Brief Overview of the Facts
December 14, 2009: The Meeting with Mr. Wojcik
5On December 14, 2009, Mr. Cato, along with his son, Kingsley Cato, met with Mr. Wojcik at his office. At the meeting, Mr. Cato transfered his home to a company owned by his son, Purple Trinity Inc.
6In order to transfer the property, Mr. Cato signed two documents: 1) an Acknowledgment and Consent; and 2) an Acknowledgement and Direction (the transfer documents).
7Mr. Wojcik made handwritten notes of the meeting. The notes stated that Mr. Wojcik had advised Mr. Cato of the following:
a) Mr. Cato was transferring the property for no value beyond having Purple Trinity assume the outstanding mortgage; b) Mr. Cato would have no interest in the property after the transfer; c) Mr. Cato would receive no money for the transfer; and d) Mr. Cato had the capacity to make the transfer and was free of any pressure or duress.
8Mr. Cato takes the position that the notes do not reflect what actually occurred at the meeting. Mr. Wojcik, he says, did not provide him with any advice. Moreover, Mr. Cato says he did not understand that he was transferring his home.
Spring 2010: Mr. Cato discovered he transferred his property
9After the meeting, there were a series of events that led Mr. Cato to suspect that he no longer owned his property. As a result of these events, Mr. Cato retained a lawyer, Desmond Brizan, to investigate title to the property. In a reporting letter dated May 27, 2010, Mr. Brizan advised Mr. Cato that the property no longer belonged to him and instead was effectively owned by Purple Trinity. He noted that the transfer was done by Mr. Wojcik, who had “represented” him in the transaction. Mr. Brizan explained:
You have to take the matter to court to exert your rights to the property. One drawback in this matter is that you had legal counsel when the transfer was done. That lawyer should have explained to you the nature and consequences of your actions.
10Mr. Cato then met with Mr. Brizan who explained the contents of the letter to him and gave him an opportunity to ask questions.
August 2010: Mr. Cato brought the action against Purple Trinity and Kingsley Cato
11In August 2010, Mr. Cato brought an action against his son and Purple Trinity. He did not sue Mr. Wojcik.
October 2010: Mr. Cato’s son defended on the basis that Mr. Wojcik gave legal advice
12In October 2010, Mr. Cato’s son defended the action, in part, on the basis that Mr. Cato had received independent legal advice from Mr. Wojcik. The statement of defence specifically noted that “any representation upon which [Mr. Cato] could or should have reasonably relied were those of his lawyer, Mr. Wojcik.”
November 2010: Mr. Cato obtained a copy of his file from Mr. Wojcik
13Mr. Cato then requested a copy of his file from Mr. Wojcik. On November 2, 2010, Mr. Wojcik provided Mr. Cato with the entire contents of the file. This included the transfer documents and the two pages of handwritten notes.
June 2014: Mr. Wojcik testified at the trial against Purple Trinity and Mr. Cato’s son
14The matter involving Mr. Cato’s son went to trial. Mr. Wojcik testified on June 5, 2014.
15Peter Cozzi represented Mr. Cato in the case against his son. 1 The thrust of Mr. Cozzi’s examination-in-chief and re-examination was that Mr. Wojcik had provided negligent advice at the meeting. Specifically, Mr. Cozzi alleged that Mr. Wojcik failed to advise Mr. Cato that the transfer of the property was a gift. In advancing this allegation, Mr. Cozzi relied on the fact that there was no mention in the two-page notes prepared by Mr. Wojcik that he had told Mr. Cato that the transfer was a gift.
May 2015: Mr. Cato brought the action against Mr. Wojcik
16On May 8, 2015, Mr. Cato commenced the action against Mr. Wojcik for breach of contract, breach of trust, breach of fiduciary duty, and negligence, seeking $160,000 for the legal costs that he paid in the action against his son. The basis for each of the claims is that Mr. Wojcik failed to give proper legal advice to Mr. Cato during the meeting with respect to transferring the property.
Legal Framework for Summary Judgment Motions
17Rule 20.04(2)(a) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, provides that the court shall grant summary judgment if satisfied that there is no genuine issue requiring a trial with respect to a claim or defence. In Hryniak v. Mauldin, 2014 SCC 7, at para. 49, Karakatsanis J. explained that 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.
18In considering a motion for summary judgment, the court should first determine if there is a genuine issue requiring a trial based only on the evidence in the motion record, without using the fact-finding powers set out in Rule 20.04(2.1) and (2.2). The analysis of whether there is a genuine issue requiring a trial should be done by reviewing the factual record and granting summary judgment if there is sufficient evidence to fairly and justly adjudicate the dispute and summary judgment would be a timely, affordable and proportionate procedure.
Analysis
19Section 4 of the Limitations Act, 2002, S.O. 2002 c. 24, Sched. B, prohibits any claim from being commenced after two years from the date on which the claim was “discovered”.
20A claim is discovered either when the person first knew (s. 5(1)(a)), or a person with the abilities and in the circumstance of the person with the claim ought to have known (s. 5(1)(b)), the following:
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.
21Pursuant to s. 5(2), a claimant is presumed to have discovered his or her claim on the “day the act or omission on which the claim is based took place, unless the contrary is proved.”
22I will consider each element in turn.
When did Mr. Cato know he had suffered an injury, loss or damage?
23In Hamilton (City) v. Metcalfe & Mansfield Capital Corp., 2012 ONCA 156, at paras. 34-35, the court used two-step approach to determine when injury, loss or damage has occurred. Following that approach, the court should first identify the relevant tort, as the damage must be relevant to the tort in question. Second, the court must identify when the injury, loss or damage arising from the tort occurred. As the court noted at para 54, damage is the condition of being worse off than before the act occurred.
24The tort alleged in the present case is that Mr. Wojcik provided negligent, inadequate legal advice, which led Mr. Cato to unwittingly transfer his property. Mr. Cato argues that he did not discover he had suffered loss, injury or damage until after the action with his son was settled: it was only then that he could calculate the precise amount of legal fees that he had incurred. I agree with Mr. Wojcik, however, that this position confuses “damage” with “damages”.
25As the court noted in Hamilton, at para. 54:
Damage is the loss needed to make out the cause of action. Insofar as it relates to a transaction induced by wrongful conduct, as I have explained, damage is the condition of being worse of than before entering into the transaction. Damages, on the other hand, is the monetary measure of the extent of that loss. All that the [plaintiffs] had to discover to start the limitation period was damage.
(See also Davies v. Davies Smith Developments Partnership, 2018 ONCA 550, at paras. 11-12.)
26In examination for discovery, Mr. Cato admitted that by June 2010, he knew the following:
a) His property had been transferred to Purple Trinity as a result of the documents that he signed at the meeting; b) Mr. Wojcik had failed to give him proper advice at the meeting; c) He would need to start legal action against his son to unwind the transfer because he believed that the transfer was fraudulent; and d) He would have to incur legal fees for the lawsuit.
27Thus, as of June 2010 Mr. Cato knew that he had suffered injury, loss or damage because he knew that he was worse off than before he had signed the transfer documents. Mr. Cato was worse off, as he had unwittingly transferred his property. Mr. Cato knew that he would have to spend money in legal fees to get his property back. While he did not know the full nature and extent of his damages, that was not required. Mr. Cato knew he had suffered “some damage” and that is sufficient to meet this element: Brozmanova v. Tarshis, 2018 ONCA 523, at para. 35.
When did Mr. Cato know that the injury, loss or damage was caused by or contributed to by an act or omission?
28In the letter dated May 27, 2010, Mr. Brizan advised Mr. Cato that Mr. Wojcik should have advised him of the nature and consequences of transferring his property. Mr. Cato takes the position that Mr. Wojcik failed to so advise him. Thus, Mr. Cato knew by the spring of 2010 that his injury, loss or damage was caused by or contributed to by an omission: Mr. Wojcik failed to provide adequate legal advice.
When did Mr. Cato know that it was Mr. Wojcik’s act or omission that led to the injury loss or damage?
29It is clear that Mr. Cato knew that the act or omission was that of Mr. Wojcik. By the spring of 2010, Mr. Cato knew that he was worse off because Mr. Wojcik had failed to provide adequate legal advice. Thus, Mr. Cato knew that his injury, loss or damage was caused or contributed to by an omission of Mr. Wojcik.
When did Mr. Cato know that a proceeding was the appropriate remedy?
30In determining this element, the question is whether the prospective plaintiff knows enough facts to base a cause of action against the defendant. This does not require the plaintiff to know that his or her claim is likely to succeed; rather, the limitation period runs from when the plaintiff has or ought to have had knowledge of a potential claim: Tender Choice Foods Inc. v. Versacold Logistics Canada Inc., 2013 ONSC 80, at para. 59.
31Mr. Cato argues that he did not know that a proceeding was appropriate until June 2014 because, until then, he did not know what Mr. Wojcik believed to be the appropriate standard of care. I cannot accept this submission. As recently explained in Dale v. Frank, 2017 ONCA 32, at para. 7, the question is whether the prospective plaintiff knows enough material facts on which to base a claim against the defendant; if so, the limitation period begins to run.
32I find that Mr. Cato knew that a proceeding was an appropriate remedy by November 2010 at the latest for four reasons. First, Mr. Cato had been advised in May 2010 by his lawyer Mr. Brizan that he would have to go to court to get his property back and that Mr. Wojcik should have advised him of the nature and consequence of signing the transfer documents.
33Second, Mr. Cato’s son specifically put the legal advice provided by Mr. Wojcik at issue in his Statement of Defence filed in October 2010.
34Third, Mr. Cato obtained Mr. Wojcik’s legal file in November 2010. It was based on the notes provided that Mr. Cato’s then lawyer, Mr. Cozzi, accused Mr. Wojcik of professional negligence when the matter against Mr. Cato’s son went to trial.
35Fourth, all of the material facts in the Statement of Claim relied on in this action were known by Mr. Cato prior to November 2010.
36Mr. Cato knew or ought to have known enough material facts on which to base an allegation of negligence against Mr. Wojcik as of November 2010 at the latest.
Conclusion
37Mr. Cato discovered his claim against Mr. Wojcik by November 2010 at the latest. By that time Mr. Cato knew the following:
- During the meeting with Mr. Wojcik, Mr. Cato had transferred his property to Purple Trinity.
- Mr. Cato did not intend to transfer his property to Purple Trinity at that meeting.
- At the meeting, Mr. Wojcik should have explained the nature and consequences of transferring the property. But Mr. Wojcik’s notes of the meeting did not match up with Mr. Cato’s recollection of the meeting, which was that Mr. Wojcik did not provide him any advice.
- Mr. Brizan advised Mr. Cato that he would have to bring a court proceeding to get his property back.
- Mr. Cato knew that he would have to incur legal expenses to bring a lawsuit to recover his property.
38Mr. Cato had all the materials facts upon which he relies in this action by November 2010. By then, Mr. Cato knew he had suffered damage because of Mr. Wojcik’s failure to provide adequate legal advice, that he would have to sue to get his property back and that he would have to incur legal costs. His claim was thus statute-barred as of November 2012. Mr. Cato did not bring this action until May 2015, well outside of the limitation period.
39There is thus no genuine issue requiring trial. Mr. Cato is statute-barred from proceeding. As a result, summary judgment is granted and the action is dismissed.
Costs
40I encourage the parties to see if they can agree on costs. If the parties are unable to agree on costs, Mr. Wojcik shall serve and file with my office written costs submissions within 15 days. Mr. Cato shall serve and file with my office any responding costs submissions within 15 days thereafter. The written submissions shall not exceed three pages in length, excluding the Costs Outline.
Justice Heather McArthur Date: June 27, 2018