Cimtel Inc. et al. v. TSV Holdings Ltd. et al.

[Indexed as: Cimtel Inc. v. TSV Holdings Ltd.]

Ontario Reports

Ontario Superior Court of Justice,

R.R. Bell J.

February 6, 2018

141 O.R. (3d) 226 | 2018 ONSC 894

Case Summary

Civil procedure — Discovery — Examination for discovery — Corporate representative of company not required to answer questions on discovery within his personal knowledge if he acquired that knowledge in capacity other than as officer or employee of company.

The defendant Azure was the parent company of Austco, of which Austco Canada was a wholly owned subsidiary. L, a former employee of the plaintiff, resigned to join Austco Canada, and Austco Canada then terminated a contract with the plaintiff. The plaintiff sued Austco Canada for breach of contract and sued L for breach of fiduciary duty. In a separate action, the plaintiff subsequently sued Azure, alleging that Azure was involved in Austco Canada's hiring of L and termination of the contract. A was currently Azure's CEO. Previously, he had held a number of positions with Austco Canada. He participated in the defence of the action against Austco Canada. In the plaintiff's action against Azure, A was to be examined for discovery as Azure's corporate representative. The parties stated a question of law in the form of a special case under Rule 22 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 whether A was obliged to answer questions within his personal [page227] knowledge, regardless of whether that knowledge was acquired in his capacity as an officer, director or employee of Azure.

Held, the motion should be granted.

Where a company's corporate representative has not been named personally as a defendant, or where the corporate representative's knowledge was gained while he or she was associated with another corporation not named as defendant in the litigation, the corporate representative must answer relevant questions only about knowledge gained in his or her capacity as an officer or employee, or inform him or herself from other employees of the corporation or from corporate records. To permit otherwise would result in the adverse party being able to obtain on discovery the knowledge of a non-party without leave, contrary to rule 31.10 of the Rules. In the circumstances of this case, A was not required, as corporate representative of Azure, to answer on discovery relevant or otherwise proper questions within his personal knowledge, if he acquired that knowledge in a capacity other than as an officer or employee of Azure. However, if A had personal knowledge about this action which Azure would have to disclose on discovery in any event, barring some unfairness, it would be more efficient to permit A to provide his personal knowledge, while he was being examined for discovery as Azure's corporate representative.

Fisher v. Pain, 1938 292 (ON SC), [1938] O.J. No. 56, [1938] 2 D.L.R. 753, [1938] O.W.N. 74 (H.C.J.); Hacking v. Skyjack Inc., [2005] O.J. No. 5507, 144 A.C.W.S. (3d) 631, 2005 47717 (S.C.J.); Kay v. Posluns, [1993] O.J. No. 188, 38 A.C.W.S. (3d) 34, 1993 CarswellOnt 2072 (Gen. Div.); Kennedy v. Suydam, [1915] O.J. No. 392, 8 O.W.N. 65 (H.C.); R. v. Judge of the General Sessions of the Peace for the County of York, Ex parte Corning Class Works of Canada Ltd., 1970 358 (ON CA), [1971] 2 O.R. 3, [1970] O.J. No. 1729, 16 D.L.R. (3d) 609, 3 C.C.C. (2d) 204, 65 C.P.R. 250, 16 C.R.N.S. 329 (C.A.), affg 1970 516 (ON SC), [1970] 3 O.R. 398, [1970] O.J. No. 1548, 1 C.C.C. (2d) 74, 63 C.P.R. 212, 12 C.R.N.S. 67 (H.C.J.) [Leave to appeal to S.C.C. refused [1971] 2 O.R. 11n, [1971] S.C.R. viii, 16 D.L.R. (3d) 617n, 1970 392 (ON CA), 3 C.C.C. (2d) 213n, 65 C.P.R. 250n, 16 C.R.N.S. 337n]; R. v. N.M. Paterson and Sons Ltd., 1980 227 (SCC), [1980] 2 S.C.R. 679, [1980] S.C.J. No. 95, 117 D.L.R. (3d) 517, 34 N.R. 597, [1981] 2 W.W.R. 103, 7 Man. R. (2d) 383, 55 C.C.C. (2d) 289, 19 C.R. (3d) 164, 5 W.C.B. 294, consd

Willroy Mines Ltd. v. New Cinch Uranium Ltd., [1983] O.J. No. 2124, 34 C.P.C. 13, 18 A.C.W.S. (2d) 506 (H.C.J.), distd

Other cases referred to

Etaliq Inc. v. Cisco Systems Inc., [2017] O.J. No. 1635, 2017 ONCA 271, affg on different grounds [2016] O.J. No. 4339, 2016 ONSC 5109 (S.C.J.); Harris v. Leikin Group Inc., [2011] O.J. No. 3534, 2011 ONSC 166, 205 A.C.W.S. (3d) 377 (S.C.J.); R. v. Amway Corp., 1989 107 (SCC), [1989] 1 S.C.R. 21, [1989] S.C.J. No. 3, 56 D.L.R. (4th) 309, 91 N.R. 18, J.E. 89-244, 33 C.P.C. (2d) 163, 68 C.R. (3d) 97, 37 C.R.R. 235, [1989] 1 C.T.C. 255, 2 T.C.T. 4074, 18 C.E.R. 305, EYB 1989-67225; R. v. Miller, 1985 22 (SCC), [1985] 2 S.C.R. 613, [1985] S.C.J. No. 79, 24 D.L.R. (4th) 9, 63 N.R. 321, 14 O.A.C. 33, 16 Admin. L.R. 184, 23 C.C.C. (3d) 97, 49 C.R. (3d) 1, 15 W.C.B. 332, affg (1982), 1982 1810 (ON CA), 39 O.R. (2d) 41, [1982] O.J. No. 3487, 141 D.L.R. (3d) 330, 70 C.C.C. (2d) 129, 29 C.P.C. 159, 29 C.R. (3d) 153, 8 W.C.B. 226 (C.A.); Scheuermann (Next friend of) v. Jablanczy, [1984] O.J. No. 394, 44 C.P.C. 97 (H.C.J.); Vanderhoek v. Philco-Ford of Canada Ltd., [1978] O.J. No. 2339, 8 C.P.C. 31, [1978] 3 A.C.W.S. 451 (H.C.J.); Wallace Neon Ltd. v. Tilden Corp., 1964 767 (BC CA), [1964] B.C.J. No. 34, 47 W.W.R. 61 (C.A.); Welsbach Incandescent Gas Lighting Co. v. New Sunlight Incandescent Co., [1900] 2 Ch. 1 [page228]

Statutes referred to

Canadian Charter of Rights and Freedoms

Rules and regulations referred to

Rules of Civil Procedure, R.R.O. 1990, Reg. 194, rules 22, 22.04, 22.05, 31.03(2), 31.06, (1), 31.10, 31.11(1)

Authorities referred to

Morden, J.W., and P.M. Perell, The Law of Civil Procedure in Ontario, 3rd ed. (Toronto: LexisNexis, 2017)

MOTION for a determination of a question of law.

David Elliott, for plaintiffs.

Stephen Cavanagh, for defendants.

R.R. BELL J.: —

Overview

[1] Is an officer, director or employee who is being examined for discovery on behalf of a corporation pursuant to rule 31.03(2) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 obliged to answer questions within his or her personal knowledge, regardless of whether that knowledge was acquired by the individual in his or her capacity as an officer, director or employee of that corporation or in some other capacity?

[2] The parties have stated this question of law in the form of a special case under Rule 22. The defendants, TSV Holdings Ltd. and Azure Health Care Ltd., seek an order that Clayton Astles, the corporate representative of Azure, is not required to answer on his examination for discovery, any relevant question put to him that is within his personal knowledge if that knowledge was acquired by him in some capacity other than his capacity as an officer, director or employee of the defendants. In support of their position, TSV Holdings and Azure rely on the line of authorities commencing with Fisher v. Pain, 1938 292 (ON SC), [1938] O.J. No. 56, [1938] O.W.N. 74 (H.C.J.).

[3] The position of the plaintiffs, Cimtel Inc. and Wireless Resident Nurse Alert Technology, is the opposite: they argue that Mr. Astles is obliged to answer any relevant question within his personal knowledge, regardless of how he acquired such knowledge. Cimtel and Wireless RNA rely on the decision in Willroy Mines Ltd. v. New Cinch Uranium Ltd., and other authorities referred to in that case ( [1983] O.J. No. 2124, 34 C.P.C. 13 (H.C.J.)). [page229]

[4] In my view, the authorities in this area support a fact specific response to the question, particularly where, as in this case, the plaintiffs have commenced two actions against different but related corporate defendants.

Background

[5] The following facts are agreed upon by the parties. Cimtel and Wireless RNA are alleged to be related companies that carry on business selling emergency nurse call systems for long-term care facilities, including retirement homes, nursing homes and hospitals.

[6] Azure formerly carried on business as TSV Holdings. Azure is the parent company of Austco Communications Systems Pty Ltd. of which Austco Marketing & Service (Canada) Ltd. is a wholly owned subsidiary.

[7] From 2001 to June 23, 2011, Cimtel was an authorized reseller of nurse call systems pursuant to reseller agreements with Austco Canada. Cimtel and Wireless RNA allege that on June 16, 2011, Tim Love, an employee of Cimtel since October 15, 1993, resigned to join Austco Canada. On June 23, 2011, Austco Canada terminated Cimtel's reseller agreement.

[8] In December 2012, Cimtel and Wireless RNA sued Austco Canada and Mr. Love, alleging that Austco Canada had breached the reseller agreement and that Mr. Love had breached his fiduciary duty.

[9] In July 2013, Cimtel and Wireless RNA sued Azure in this action. In this action, Cimtel and Wireless RNA allege that Azure was involved in the hiring of Mr. Love by Austco Canada and in the decision to terminate the reseller agreement. Azure denies these allegations.

[10] The parties have not yet been examined for discovery in this action. Cimtel and Wireless RNA have elected to examine Mr. Astles on behalf of Azure. Mr. Astles is currently Azure's CEO. Azure's motion to substitute another representative of Azure was dismissed.

[11] Previously, Mr. Astles held a variety of positions with Austco Canada: sales manager, vice-president (2009), president (2013) and CEO (2015).

[12] In their action against Austco Canada, the plaintiffs elected to examine Aaron Rosler, the national sales manager of Austco Canada. On his examination for discovery as the corporate representative of Austco Canada, Mr. Rosler stated that Mr. Astles made the decision to hire Mr. Love and to terminate the reseller agreement between Austco Canada and Cimtel. [page230]

[13] Mr. Astles participated in the defence of the action against Austco Canada: he assisted counsel with the preparation of Austco Canada's affidavit of documents and he responded to undertakings given on Austco Canada's examination for discovery. Through answers to undertakings, Mr. Astles indicated that he discussed the possibility of hiring Mr. Love with Robert Grey and Wayne Robinson, but that "[t]here was no communication between Austco [Canada] and Azure regarding Tim Love's hire". Cimtel and Wireless RNA allege that both Mr. Grey and Mr. Robinson were employed by and/or had an interest in Azure at this time. Azure denies this allegation.

[14] In his examination for discovery in the Austco Canada action, Mr. Love stated that he interviewed with Mr. Astles (then vice-president of Austco Canada), and another person from Australia whom he cannot now identify.

Analysis

[15] In my view, resort to the special case procedure is justified in this instance. The parties have anticipated that issues may arise as to the scope of Mr. Astles' examination for discovery as the representative of TSV Holdings and Azure, and a ruling on the question stated by the parties may shorten the discovery process, including any related motions. The parties have complied with the requirements of rule 22.04.

[16] On the hearing of a special case, the court may draw any reasonable inference from the facts agreed on by the parties and the documents referred to in the special case. On the determination of the question of law, the court may make an order or grant judgment accordingly (rule 22.05).

(i) Examinations for discovery -- General principles

[17] The scope of an examination for discovery is set out in rule 31.06(1): a person examined for discovery is required to answer, to the best of his or her knowledge, information and belief, any proper question relevant to any matter in issue in the action. The 1984 amendments to the Rules of Civil Procedure broadened the scope of examination for discovery under rule 31.06; I note, however, the 2010 amendment to restrict discovery to questions "relevant to" any matter in issue instead of questions "relating to" any matter in issue.

[18] Where a corporation may be examined for discovery, rule 31.03(2) provides that (a) the examining party may examine any officer, director or employee on behalf of the corporation, but on motion by the corporation, the court may order the examining party to examine another officer, director or employee; and (b) the [page231] examining party may examine more than one officer, director or employee only with the consent of the parties or the leave of the court.

[19] In The Law of Civil Procedure in Ontario, 3rd ed., J.W. Morden and P.M. Perell describe the purposes of an examination for discovery as follows:

The examinations for discovery provide an opportunity to define the issues that are contested and uncontested and to move forward in the proof or disproof of contested facts. In Modriski v. Arnold, [1947] O.J. No. 132 (C.A.), the Court of Appeal stated that the purposes of production and discovery are: (1) to enable the examining party to know the case he or she has to meet; (2) to enable the examining party to obtain admissions that will dispense with formal proof of his or her case; and (3) to obtain admissions that will undermine the opponent's case.

In Ontario Bean Producers Marketing Bd. v. W.G. Thompson & Sons (1982), 1982 2084 (ON SC), 35 O.R. (2d) 711 (Div. Ct.), the Divisional Court elaborated and extended the various aims of discovery. The Court noted the following purposes for examinations for discovery: (1) to enable the examining party to know the case he or she has to meet; (2) to procure admissions to enable a party to dispense with formal proof; (3) to procure admissions which may destroy an opponent's case; (4) to facilitate settlement, pre-trial procedure, and trials; (5) to eliminate or narrow issues; and (6) to avoid surprise at trial ((Toronto: Lexis Nexis Canada, 2017), at p. 677).

[20] On discovery, a representative of the corporation is required to answer not only "on their own knowledge", but also on information and belief (Harris v. Leikin Group Inc., [2011] O.J. No. 3534, 2011 ONSC 166 (S.C.J.), at para. 21). The issue on this motion is whether the corporate representative is required to answer as to his or her personal knowledge regardless of the capacity in which that knowledge was acquired.

(ii) Case law

[21] I begin with the decision in Fisher v. Pain. At the time of the decision in Fisher, it had become possible to examine for discovery either an officer or a servant of the corporate party. On his examination for discovery, an officer of the corporation refused to answer a number of questions put to him on the basis that the information that enabled him to respond had been acquired by him outside of and independently of his position as a corporate officer.

[22] Roach J. ordered that with respect to certain questions, the corporate officer was required to inform himself as an officer of the company and reattend and answer the questions. In discussing the purpose of the procedural rule change to allow either an officer or a servant of a corporate party to be examined for discovery, Roach J. referred with approval to Welsbach Incandescent Gas Lighting Co. v. New Sunlight Incandescent Co., [1900] 2 Ch. 1, [page232] where it was held that an officer of a company answering interrogatories is only bound to answer as to his knowledge acquired in the course of his employment by the company and as to the result of inquiries made by him of other officers and agents of the company with regard to their knowledge acquired in the same manner. Roach J. then stated:

He [the corporate representative] is still the mouthpiece of the company in the peculiar circumstances of that case. To extend the interpretation of the Rule so as to enable a litigant against a company to examine an officer of that company concerning matters, knowledge of which he acquired not as an officer of the company but in some other capacity, would be assisting the litigant in getting up evidence. That is not the purpose of the Rule. The practical result of such an extension would be to enable larger discovery to be obtained from a corporation than from an individual, and no such distinction is intended by the Rule.

[23] The reasoning in Fisher was cited with approval by the Court of Appeal for Ontario in R. v. Judge of the General Sessions of the Peace for the County of York; Ex parte Corning Glass Works of Canada Ltd., where it held that six employees and officers of a corporation were compellable witnesses to give evidence against the corporation (1970 358 (ON CA), [1971] 2 O.R. 3, [1970] O.J. No. 1729 (C.A.), affg 1970 516 (ON SC), [1970] 3 O.R. 398, [1970] O.J. No. 1548 (H.C.J.), leave to appeal to S.C.C. refused [1971] 2 O.R. 11n, [1971] S.C.R. viii). In Corning Glass, at p. 7 O.R., Arnup J.A. commented on the difference between the scope of evidence to be given on examination for discovery by an officer appearing on behalf of the corporation, and the scope of evidence to be given by an officer of the same corporation at trial [at paras. 10-12]:

On discovery, the witness literally speaks for the corporation. He has been described, as long ago as 1902, as the "mouthpiece" of the corporation: Morrison v. Grand Trunk R. Co. (1902), 5 O.L.R. 38, 2 C.R.C. 398. The term was adopted, with reference to the servant of the corporation, by Roach J., in Fisher v. Pain et al., 1938 292 (ON SC), [1938] O.W.N. 74, at p. 76, [1938] 2 D.L.R. 753 (m). As pointed out by Grant J., if such a witness does not know the answer to a relevant question, he must inform himself from others employed by the corporation or from its records. Conversely, he may be examined only as to matters coming to his knowledge as an officer of the corporation. Knowledge which he has acquired otherwise than as such officer cannot be explored: Fisher v. Pain, supra.

At the trial, a witness subpoenaed to give evidence, who happens to be a servant, officer or even president and controlling shareholder of a corporate accused, is not called upon to speak "for" the corporation. He is not its "mouthpiece". He is required to testify as to all relevant facts within his knowledge, whether those facts were acquired by him during his employment or term of office or were acquired in circumstances completely unrelated to the corporation. He is in no different position from a witness who had been in complete charge of the corporation's affairs for many years, but has retired before the charge against it was laid. Both must tell what they know, so far as [page233] it is relevant and admissible. Both are entitled to all the protection that is available to any witness, and in particular, the protection against self-incrimination found in both the Canada Evidence Act . . . and the Ontario Evidence Act. . . .

At trial the corporation is not a witness. It is not being "self-incriminated" because one of its managers is giving damaging evidence in the witness-box.

[24] These statements by Arnup J.A. were approved by the Supreme Court of Canada in R. v. N.M. Paterson & Sons Ltd., where the court determined that the manager of a grain elevator, owned by the accused corporation, was a compellable witness at trial (1980 227 (SCC), [1980] 2 S.C.R. 679, [1980] S.C.J. No. 95, at pp. 691-92 S.C.R.).

[25] Cimtel and Wireless RNA argue that Paterson and Corning Glass do not apply to the issue before me as both were criminal cases and, in any event, the decisions are outdated as they were decided prior to the Canadian Charter of Rights and Freedoms. I disagree. Both Paterson and Corning Glass drew a distinction between a corporate officer giving evidence at trial and a corporate officer giving evidence on discovery where the witness "speaks for" the corporation. As a result of these decisions, the common law right against compellability at trial at the instance of the Crown was removed from corporations (R. v. Amway Corp., 1989 107 (SCC), [1989] 1 S.C.R. 21, [1989] S.C.J. No. 3, at pp. 40-41 S.C.R.). The fact that the comparison was made in a criminal context does not undermine the principle enunciated in those cases. I note as well that Fisher, approved in both Paterson and Corning Glass, arose in the context of a civil dispute.

[26] Cimtel and Wireless RNA also argue that the observations of the Supreme Court of Canada in Paterson approving the statements of Arnup J.A. with respect to Fisher are obiter. Nonetheless, the obiter remarks of the Supreme Court of Canada constitute a considered opinion that should be followed by the courts of Ontario (R. v. Miller (1982), 1982 1810 (ON CA), 39 O.R. (2d) 41, [1982] O.J. No. 3487 (C.A.), affd 1985 22 (SCC), [1985] 2 S.C.R. 613, [1985] S.C.J. No. 79).

[27] The second line of authorities, on which the plaintiffs rely, is said to take as its starting point, the decision of Middleton J. in Kennedy v. Suydam, [1915] O.J. No. 392, 8 O.W.N. 65 (H.C.). At the examination for discovery of the defendant Suydam, counsel for the plaintiff proposed to examine Suydam in his personal capacity and as an officer of each of the two corporate defendants. Counsel for Suydam insisted that there be three separate examinations. Middleton J. held that the plaintiff was entitled to examine Suydam as an individual defendant and as an officer of each of the two corporate defendants in the same examination and that Suydam was required to provide facts within his personal [page234] knowledge, without regard to the capacity in which those facts came to his personal knowledge.

[28] In Willroy Mines, the plaintiff moved for an order that Mr. White, the representative of two of the corporate defendants, reattend to answer questions asked on his examination for discovery. Prior to that examination, Mr. White had been examined as an officer of a third corporate defendant and in his personal capacity. The senior master concluded that the observations of the Supreme Court of Canada in Paterson -- approving the statements of Arnup J.A. with respect to Fisher -- were obiter. The senior master followed the decision in Kennedy in preference to that in Fisher and required the witness to disclose his personal knowledge in answer to any proper question on the examination for discovery as representative of the two corporations on whose behalf he was being examined without regard to when or how he acquired his knowledge.

[29] In Kay v. Posluns, Ground J. had the opportunity to review the two lines of authorities in the context of a motion for leave to appeal ([1993] O.J. No. 188, 1993 CarswellOnt 2072 (Gen. Div.)). Steele J. had dismissed a motion to compel the corporate representative of one of the parties to reattend on his examination for discovery to answer certain questions, on the basis that the decision in Fisher was more applicable to the facts of the case before him than Willroy Mines.

[30] Ground J. concluded, at para. 37, that there is no inconsistency in the two lines of cases when the language used by the court is confined to the facts of the particular case:

Kennedy v. Suydam, supra, and [the] line of cases following it stand for the proposition that, where a corporate officer is a party to the action personally and is being examined in his or her personal capacity, any proper question must be answered regardless of the capacity in which he or she acquired the personal knowledge. When the corporate officer being examined is not a party to the action in his or her personal capacity, reference should be made to the decision of Roach J. in Fisher v. Pain, supra, as approved by the Court of Appeal in Corning Glass Works of Canada, supra, and as approved by the Supreme Court of Canada in Regina v. N.M. Paterson & Sons Limited, supra.

[31] The distinction drawn by the court in Kay v. Posluns was recently referred to by Corthorn J. in Etaliq Inc. v. Cisco Systems Inc., [2016] O.J. No. 4339, 2016 ONSC 5109 (S.C.J.) (affd on different grounds, [2017] O.J. No. 1635, 2017 ONCA 271). Corthorn J. was not, however, required to rule on the scope of the corporate representative's examination for discovery in Etaliq.

[32] I agree with Ground J.'s conclusion that there is no inconsistency in the two lines of cases when each decision is considered in the context of the particular facts of the case. The same [page235] conclusion was reached by the British Columbia Court of Appeal in Wallace Neon Ltd. v. Tilden Corp., which left open for further consideration the application of the reasoning in Kennedy to personal knowledge gained by the witness before he or she was appointed or employed (1964 767 (BC CA), [1964] B.C.J. No. 34, 47 W.W.R. 61 (C.A.), at pp. 63-64 W.W.R.).

[33] The concern in both lines of authorities is the extent to which a corporation ought to be bound by the answers of the officer or employee being examined for discovery on its behalf. The corporate officer is the "mouthpiece" of the corporation and it is the knowledge, information and belief of the corporation on which the adverse party is entitled to examine. At the trial of the action, a party may read into evidence, as part of the party's own case against an adverse party, any part of the evidence given on the examination for discovery of the adverse party or a person examined for discovery on behalf of the adverse party, provided the evidence is otherwise admissible (rule 31.11(1)). Where the corporate representative has not been named personally as a defendant, or where the corporate representative's knowledge was gained while he or she was associated with another corporation not named as a corporate defendant in the litigation, in my view, the corporate representative must only answer relevant questions with knowledge gained in his or her capacity as an officer or employee, or inform him or herself from other employees of the corporation or from corporate records. To permit otherwise would result in the adverse party being able to obtain on discovery the knowledge of a non-party without leave, contrary to rule 31.10 of the Rules of Civil Procedure.

[34] The facts before me are very different than those before the senior master in Willroy Mines. The senior master concluded that prohibiting counsel from inquiring into the past conduct of the witness, of which he had personal knowledge, when that knowledge was gained as an officer or servant of another defendant, would not amount to a second examination of a previously examined company. Mr. Astles has not been named as a personal defendant in this action, nor has his previous employer, Austco Canada, been named as a corporate defendant. And, unlike Willroy Mines, there are two concurrent actions with the same plaintiffs and different but related defendants.

[35] Cimtel and Wireless RNA argue that the interrelated nature of Azure and Austco Canada is relevant to the question before me and that it would be artificial for Mr. Astles to be able to refuse to answer questions relating to the hiring of Mr. Love on the basis that Mr. Astles' personal knowledge was acquired while he was an employee or officer of Austco Canada. They rely upon [page236] the decision of Matheson J. in Hacking v. Skyjack Inc., [2005] O.J. No. 5507, 2005 47717 (S.C.J.). Hacking does not, in my view, assist the plaintiffs. In that action against two corporate defendants for wrongful dismissal, Matheson J. ordered the corporate representatives of each of the defendants to answer the undertakings given and questions ordered to be answered. Relying on Willroy Mines, Matheson J. observed that an individual who is examined as an officer or servant of a company may be asked questions that bind the company and may also answer questions that have come to her or his knowledge. Hacking did not raise the issue of whether a corporate representative could be examined on personal knowledge obtained by the corporate representative prior to his or her appointment to or employment by a corporate defendant -- both corporations had been named as defendants in Hacking. Unlike Kennedy, the corporate representative in Hacking had not been named as a personal defendant.

[36] In this action, the plaintiffs plead that Austco Canada acted "at the behest of" TSV Holdings and Azure. They argue that exploring the relationship between Azure and Austco Canada will be central to their discovery of Mr. Astles as the corporate representative of Azure. The defendants argue that the plaintiffs are, indirectly, attempting to obtain Mr. Astles' testimony while he was employed by Austco Canada.

[37] The evidence possessed by Mr. Astles must be relevant to and properly the subject of discovery in this action. I do not accept the plaintiffs' argument that it is an artificial exercise to distinguish between Mr. Astles' employers for the purposes of determining when his personal knowledge was acquired in circumstances where there are two concurrent actions, with the same plaintiffs, arising from the same events, albeit against different parties. The events complained of in both actions occurred in 2011 when Mr. Astles was employed by Austco Canada. The plaintiffs elected not to name Austco Canada as a defendant in this action. On examination for discovery, Cimtel and Wireless RNA are entitled to the corporate knowledge, information and belief of Azure, not that of Austco Canada.

[38] As would be the case with any corporate representative examined for discovery, Mr. Astles is also required to inform himself from other employees of Azure or from Azure's records. The corporation is also required to make reasonable inquiries of third parties: Scheuermann (Next friend of) v. Jablanczy, [1984] O.J. No. 394, 44 C.P.C. 97 (H.C.J.) and Vanderhoek v. Philco-Ford of Canada Ltd., [1978] O.J. No. 2339, 8 C.P.C. 31 (H.C.J.). The reasonableness of such inquiries would need to be determined in light of particular questions under consideration. [page237]

[39] I add the following proviso to my opinion on the question before me: if Mr. Astles has personal knowledge relevant to this action which the corporate defendant would have to disclose on discovery in any event, barring some unfairness, it would be more efficient to permit Mr. Astles to provide his personal knowledge while he is being examined for discovery as the corporate representative of Azure. It would be open to Mr. Astles to clarify his evidence by testifying as to when and how he acquired his personal knowledge and the extent to which he communicated that knowledge to any officer or employee of Azure. This is the approach that was suggested in Willroy Mines and, in my view, addresses the concern as to the extent to which the corporation is to be bound by the answers given by the corporate representative on discovery.

Disposition

[40] For these reasons, I answer the question posed by the parties in the factual context of this case as follows: as corporate representative of Azure, Mr. Astles is not required to answer on discovery, relevant and otherwise proper questions within his personal knowledge, if he acquired that knowledge in a capacity other than as an officer or employee of Azure; however, if Mr. Astles has personal knowledge relevant to this action which Azure would be required to disclose on discovery in any event, barring some unfairness, Mr. Astles should provide his personal knowledge, indicating how and when his personal knowledge was acquired.

[41] The parties are encouraged to try to reach an agreement on costs of the motion, failing which they may make written submissions limited to a maximum of three pages, double-spaced, exclusive of a costs outline, within 30 days of the date of release of this decision.

Motion granted.

End of Document