COURT FILE NO.: 17-71591 DATE: January 2, 2019

Superior Court of Justice - Ontario

RE: Melanie Gates, Jessica Gates, Ryan Gates, Robert Gates, Therese Balfour, Balmoral Insurance Brokers Ltd., Hendrika Hengeveld v. Robert Gates, Therese Balfour, Balmoral Insurance Brokers Ltd.

BEFORE: Master Fortier

COUNSEL: Stephen Cavanagh, for the Plaintiffs Mitchell Kitagawa, for the Defendants

HEARD: August 16, 2018

Endorsement

1. The defendant, Robert Gates brings this motion for summary judgment under rule 20.01(3) and 20.04 of the Rules of Civil Procedure. He is asking that the action brought by the plaintiff Melanie Gates be dismissed because it was commenced after the expiration of the two year limitation period in section 4 of the Limitations Act, 2002 (“the Act”).

Background

2. This is one of three actions brought by various members of the Gates family as a result of a car accident that occurred on January 5, 2013.

3. On January 5, 2013, Robert Gates (or “Mr. Gates”) was driving westbound on Highway 60, toward Huntsville, Ontario. His wife, Melanie Gates, (or “Ms. Gates) was in the front passenger seat and the couple’s two children, Ryan and Jessica Gates were in the back seat.

4. Another vehicle, driven by Henrika Hengeveld (“Ms. Hengeveld”) collided with the Gates vehicle when she attempted to cross Highway 60 in front of the Gates vehicle. All of the members of the Gates family were injured as a result of the accident. Ms. Hengeveld was charged with careless driving.

5. The Gates family retained lawyer James McMahon to represent them and a statement of claim was issued against Ms. Hengeveld on December 16, 2014.

6. On January 15, 2015, Ms. Hengeveld filed her statement of defence asserting various elements of negligence against Robert Gates.

7. Mr. Gates testified at his examination for discovery on September 25, 2015 that at the time of the accident, he was “travelling the limit plus or minus a few kilometers”.

8. Ms. Hengeveld was examined for discovery on October 7, 2015. Her evidence at discovery did not suggest or support any allegations of negligence against Mr. Gates.

9. According to Ms. Gates affidavit filed in support of the motion, she did not observe the vehicle’s speedometer and does not know exactly at what speed her husband was driving at the time of the impact. She further stated that she did not have the opportunity of speaking with the police after the accident.

10. On December 9, 2015, Ms. Hengeveld amended her statement of defence to add a counterclaim for contribution and indemnity against Robert Gates. According to Melanie Gates, this triggered the second action as she was not aware that Robert Gates was in any way potentially at fault for the accident until Ms. Hengeveld amended her claim to include a counterclaim for contribution and indemnity against him.

11. In the summer of 2016, Melanie Gates retained lawyer Frank Tierney to represent her interests and those of the two children. On February 8, 2017, Mr. Tierney commenced the present action naming Robert Gates, the family’s insurance broker and the brokerage as defendants. This motion relates to the second action.

12. A third action was commenced on July 6, 2017 by Melanie Gates against her former lawyer, James McMahon after Robert Gates raised the limitation period in his defence to the present action.

13. In this motion, the defendant Robert Gates argues that the within action against him is statute barred as the plaintiff Melanie Gates issued her statement of claim more than four years after the accident. Mr. Gates argues that at the latest, the limitation period would begin to run on January 15, 2015 when Ms. Hengeveld filed a statement of defence asserting various elements of negligence against Mr. Gates.

14. Melanie Gates takes the position that the limitation period did not begin to run until December 9, 2015 when Ms. Hengeveld amended her statement of defence to include a counterclaim alleging specific acts of negligence against Robert Gates and therefore the present action was commenced within the limitation period.

Disposition

15. For the reasons that follow, in my view, there is a genuine issue requiring trial with respect to the Defendant Robert Gates’ limitation period defence, specifically as to when Ms. Gates can be said to have discovered that Mr. Gates was the person who potentially committed the act or omission causing her damages within sub-section 5(1) (a) (iii) of the Act. Accordingly, I decline to grant summary judgment dismissing the present action and leave the limitation defence for adjudication at trial.

The Law and Analysis

16. As provided by rule 20.01(3) a defendant may move with supporting affidavit material or other evidence for summary judgment dismissing all or part of the claim in the statement of claim. Summary judgment shall be granted by the court if there is no genuine issue requiring a trial (rule 20.04 (2)).

17. In determining whether there is a genuine issue requiring a trial, the court shall consider the evidence submitted by the parties (rule 20.04(2.1)). Summary judgment will be available if there is sufficient evidence to justly and fairly adjudicate the dispute. The judge must be able to make the necessary findings of fact, to apply the law to those facts and thereby arrive at a just result. [1]

18. The sufficiency of the evidence produced on a motion for summary judgment is important as the court must take a “hard look” at the evidence to determine whether it raises a genuine issue requiring a trial. Each party must therefore put its “best foot forward” and submit cogent and compelling evidence to support or oppose the relief sought. Further, pursuant to rule 20. 02 (1), the court may draw an adverse inference from the failure of a party to provide the evidence of any person having personal knowledge of the contested facts on a motion for summary judgment.

19. The two year limitation period under s. 4 of the Act runs from the point that the claim is discovered. As to when a claim was or should have been discovered by the plaintiff, section 5 of Act provides:

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.

20. The test on a summary judgment motion based on a limitation period is whether there is a genuine issue respecting discoverability that requires a trial. If the evidence on the issue of discoverability is "less than clear" the motion for summary judgment should be refused. [2]

21. There is an onus placed on both parties in a summary judgment motion with respect to a statutory limitation period. First, the moving party has both a legal and evidentiary onus to satisfy the Court that there is no genuine issue requiring a trial. Second, the responding party must proffer evidence sufficient to rebut the presumption under s. 5 (2) of the Act that the plaintiff knew about the claim on the day on which the claim took place, or at least demonstrate that there is a genuine issue requiring trial on that issue. [3] In order to rebut the presumption under s. 5(2), the plaintiff must establish that the claim was not discovered until some later date, based on the four criteria set out in subsection 5(1)(a). [4]

22. It is clear from the evidence before me that Ms. Gates would have knowledge of her claim that would satisfy the first two criteria of s.5(1) (a) of the Act two years prior to the commencement of her action. Notably, Ms. Gates would know that the injury, loss or damage had occurred and that it was caused by or contributed by an act or omission. Although all of the elements of s.5 (1) (a) of the Act must be satisfied before the limitation period begins to run, [5] in my view, the outcome of this motion turns upon the third criteria. In particular, when should a reasonable person with the abilities and in Ms. Gates circumstances have known that:

iii- the act or omission was that of Mr. Gates.

23. The Court of Appeal in Lawless v. Anderson [6] related discoverability to knowledge of the material facts giving rise to a cause of action. As held by the court:

24. The principle of discoverability provides that "a cause of action arises for the purposes of a limitation period when the material facts on which it is based have been discovered, or ought to have been discovered, by the plaintiff by the exercise of reasonable diligence. This principle conforms with the generally accepted definition of the term 'cause of action' — the fact or facts which give a person a right to judicial redress or relief against another": Aguonie v. Galion Solid Waste Material Inc. (1998), 38 O.R. (3d) 161 (Ont. C.A.), at p. 170.

25. Determining whether a person has discovered a claim is a fact-based analysis. The question to be posed is whether the prospective plaintiff knows enough facts on which to base an allegation of negligence against the defendant. If the plaintiff does, then the claim has been "discovered", and the limitation begins to run: see Soper v. Southcott (1998), 39 O.R. (3d) 737 (Ont. C.A.) and McSween v. Louis (2000), 132 O.A.C. 304 (Ont. C.A.).

26. Counsel for Mr. Gates argues that the principles of discoverability as outlined in Lawless apply to this case. In particular, a cause of action arose when the material facts were known, or ought to have been discovered upon which Ms. Gates can base an allegation. Counsel argues that on the date of the loss, Ms. Gates knew that she was involved in a car accident, had suffered an injury and that Mr. Gates and Ms. Hengeveld were the drivers of the vehicles in question. She possessed enough material facts to base allegations of negligence against Mr. Gates either on the date of the accident or at the latest upon receipt of Ms. Hengeveld’s statement of defence in January 2015 which contained allegations of negligence against Mr. Gates. Accordingly, it is argued that Ms. Gates action against Mr. Gates is statute barred under the Act.

27. Counsel for Ms. Gates submits that recent decisions appear to reflect a more comprehensive or “holistic” approach to the determination of the discoverability question, indicating that a finding that the plaintiff has a “cause of action” is only the beginning of the analysis. [7] The recent cases, counsel argues,

28. clearly highlight the necessity of the s. 5(1) (a) (iv) “appropriateness” analysis in deciding the issue of discoverability. [8]

29. Counsel for Ms. Gates argues that the determination of when Ms. Gates discovered that the act or omission was that of her husband does not end the analysis. As held in the recent decisions of the Court of Appeal in Gillham and Clarke v. Faust, [9] an analysis of the criterion under s. 5(1) (a) (iv) of the Act, must also be undertaken to determine when Ms. Gains ought reasonably to have known the proceeding was an appropriate remedy. This analysis includes a consideration of whether Ms. Gates had good reason to believe that she had a legal claim for damages before knowing that commencing an action would be an appropriate remedy.

30. I am unable to accept the submission that sub-section 5(1) (a) (iv) of the Act applies to this case. The appropriate means test is relatively narrow as was recently explained by the court of Appeal in Nasir Hospitality Services Inc. v. Intact Insurance [10] at paragraphs 46 and 50 as follows:

31. In commencing his analysis under s. 5(1)(a)(iv) of the Act, the motion judge properly noted the general proposition that the determination of when an action is an appropriate means to seek to remedy an injury, loss or damage depends upon the specific factual or statutory setting of each individual case: 407 ETR Concession Company Limited v. Day, 2016 ONCA 709, 133 O.R. (3d) 762, leave to appeal refused, [2016] S.C.C.A. No. 509, at para. 34; Winmill v. Woodstock (Police Services Board), 2017 ONCA 962, 138 O.R. (3d) 641, leave to appeal to SCC requested, at para. 23.

32. Finally, in Presidential MSH Corporation v. Marr Foster & Co. LLP, 2017 ONCA 325, 135 O.R. (3d) 321, Pardu J.A. observed that the jurisprudence discloses two circumstances in which the issue of appropriate means most often delays the date on which a claim was discovered. First, resorting to legal action might be inappropriate in cases where the plaintiff relied on the superior knowledge and expertise of the defendant, especially where the defendant undertook efforts to ameliorate the loss: at para. 26. Second, a legal action might not be appropriate if an alternative dispute resolution process "offers an adequate alternative remedy and that process has not fully run its course": at para. 29. See also paras. 28-48; and Har Jo Management Services Canada Ltd. v. York (Regional Municipality), 2018 ONCA 469, at paras. 21 and 34-35. In this regard, in Winmill this court held that resort to a civil proceeding for a remedy in respect of damage flowing from an incident might not be an appropriate means while criminal proceedings in respect of the incident remain outstanding: at para. 28.

33. In the present case, I can see no valid basis for concluding that Ms. Gates was entitled to believe that having regard to her injuries, a civil action would not be an “appropriate means” to seek compensation. The parties had not embarked on any alternative dispute resolution process (indeed a civil action was already underway), nor did Ms. Gates rely on the superior knowledge or expertise of Mr. Gates. This was a single incident motor vehicle collision where a civil action was the appropriate means to seek redress, once the claimant had discovered the requisite information in section 5(1)(a)(i-iii) of the Limitations Act.

34. The question of when a reasonable person with the abilities and in the circumstances of Ms. Gates ought to have known that the accident was caused or contributed by Mr. Gates is not clear on the evidence before the court. I observe that on a motion for summary judgment, each party must put its “best foot forward” and submit cogent and compelling evidence to support or oppose the relief sought. In my view, the defendant Robert Gates did not put his best foot forward on this motion. In particular, Mr. Gates filed no affidavit evidence of his own - rather he relied on the affidavit of Shaun Jaberolansar, a lawyer with the firm representing Mr. Gates. The courts have found that the use of hearsay evidence on a summary judgment motion to be problematic, particularly where direct evidence is available [11]. The only direct evidence before me is found in the responding party’s motion materials.

35. With those comments in mind, I turn to the evidence provided by Ms. Gates. According to Ms. Gates, at the time the first action was commenced, she believed that the accident had been entirely the fault of Ms. Hengeveld. Indeed, Ms. Hengeveld had been charged with careless driving. In addition, there was no suggestion from Ms. Hengeveld during her examination for discovery that Mr. Gates might somehow bear some responsibility. Ms. Hengeveld’s original defence did not include a counterclaim against Mr. Gates and only included what can be described as common or “boilerplate” allegations of contributory negligence with respect to Mr. Gates’ own claim.

36. Ms. Gates states that the possibility of Mr. Gates also being partly liable for the accident only arose when Ms. Hengeveld amended her defence to include a counterclaim. The amendment of the defence was the first time that Ms. Hengeveld took the position that Mr. Gates might be partially responsible for the motor vehicle accident.

37. As the evidence on the issue of discoverability is “less than clear”, in my view the issue ought to be determined on a full evidentiary record at trial.

Conclusion

34. For the reasons outlined above, in my view, there is a genuine issue respecting discoverability that requires a trial. Accordingly, the motion for summary judgment is dismissed.

35. The parties have provided me with their costs outlines. If counsel are unable to agree on costs, the plaintiff is to deliver her written submissions, not to exceed three pages in length within 14 days of the release of these reasons; the defendants’ submissions not to exceed three pages to follow no more than 14 days thereafter.

Master Fortier

[1] Hryniak v. Mauldin, 2014 SCC 7, [2014] 1 S.C.R. 87, at para. 49. [2] Lindhe v. Chalte, 2015 ONSC 2821, 49 C.C.L.I. (5th) 264, at para. 26. [3] Shukster v. Young, 2012 ONSC 4807 at para. 19. [4] J.C v. Farant, 2018 ONSC 2692, 141 O.R. (3d) 421, at para. 18. [5] Longo v. Maclaren Art Centre Inc., 2014 ONCA 523 O.A.C. 246, at para. 41. [6] Lawless v. Anderson, 2011 ONCA 102, 81 C.C.L.T. (3d) 220, at paras. 22 and 23. [7] Gillham v. Lake of Bays (Township), 2018 ONCA 667, 79 C.L.R. (4th) 12, at para. 33. [8] Clarke v. Faust, 2016 ONCA 223, 400 D.L.R. (4th) 267 at para. 11; Gillham at paras. 33-35 J.C. at paras. 66-74. [9] Gillham, at paras. 33, 34, 35, 36. [10] Nasir Hospitality Services Inc. v. Intact Insurance, 2018 ONCA 725, 142 O.R. (3d) 561 paras. 46, 50. [11] Longo, at para. 46.