Court File and Parties

Court File No.: CV-18-4116 Date: 2019-03-15 Superior Court of Justice – Ontario

Re: Amy Gaska and G.R.T. Genesis Inc. v. Bruno Timpano G.R.T. Genesis Inc. and Bruno Timpano v. Amy Gaska, William Gaska and Diane Gaska

Before: Daley, J.

Counsel: E.M. Rogers, for the Plaintiff, Amy Gaska - Defendant by Counterclaim N. Baig, for the Defendants, G.R.T. Genesis Inc. and Bruno Timpano – Plaintiffs by Counterclaim

Heard: February 15, 2019

Endorsement

Nature of Motion & Evidentiary Record:

[1] The defendants moved to strike certain paragraphs of the plaintiff’s statement of claim pursuant to rr. 25.11 and 49.05 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194.

[2] The plaintiff is a former employee of the defendant company, and she commenced the within action seeking damages for constructive dismissal as well as damages relating to the alleged bad faith conduct on the part of the defendant employer.

[3] In the plaintiff’s statement of claim, she made certain allegations at paragraphs 52, 53 and 54, wherein she refers to correspondence from the defendants’ counsel dated August 8, 2018, addressed to her counsel. This correspondence from the defendants’ counsel was marked “Without Prejudice”.

[4] The defendant’s motion is premised on their position that the correspondence sent by the defendants’ counsel was privileged communication sent for the purpose of effecting a settlement of the action.

[5] Following service of the statement of claim, the defendants delivered a statement of defence and counterclaim.

[6] Thus, the defendants’ motion to strike certain paragraphs from the statement of claim has been brought after the filing of their pleading in response to the plaintiff’s claim.

[7] During the course of submissions on behalf of counsel, I questioned whether the defendants’ motion could proceed when they had filed a pleading in response to the statement of claim. No leave to proceed with this motion was sought by counsel for the defendants.

[8] Counsel were invited to file supplementary submissions with respect to this preliminary issue.

[9] Counsel for the plaintiff takes the position that r. 2.02 is engaged; that the defendants’ motion cannot proceed, as no leave was sought to bring the motion to strike the paragraphs from the statement claim; and, further, the defendants have not moved within a reasonable time after becoming aware of an alleged irregularity in the statement of claim.

[10] The evidentiary record on the defendants’ motion contains correspondence from counsel for the defendants dated October 23, 2018, wherein they raise complaints with respect to paragraphs 52, 53, 54, 71 and 74 of the statement of claim and, in particular, assert that the statement of claim reveals disclosure of without-prejudice communication by counsel for the defendants with counsel for the plaintiff. As such, counsel for the defendants advised that a motion would be brought to strike those allegations from the statement of claim pursuant to r. 25.11(b).

[11] In response to the defendants’ counsel’s letter of October 23, 2018, counsel for the plaintiff emailed a response on October 24, 2018, advising that the letter had been considered and that counsel for the defendants were directed to either deliver a statement of defence or a notice of motion seeking to strike the paragraphs from the statement of claim no later than the end of the day on November 1, 2018, failing which the defendants would be noted in default.

[12] The defendants served a statement of defence and counterclaim, with certain defendants added by counterclaim, on counsel for the plaintiff on November 1, 2018. No motion to strike the paragraphs complained of was brought prior to the service of the statement of defence and counterclaim.

[13] Subsequent to the delivery of the defendants’ pleading, no further mention of the defendants’ motion was made until the within motion was brought. However, in the meantime counsel for the plaintiff brought a motion seeking particulars with respect to a demand for particulars and production of certain documents for inspection. That motion was heard and determined in motions court on January 15, 2019.

[14] On February 5, 2019, the defendants served their motion to strike certain paragraphs of the statement of claim, returnable on February 15, 2019.

[15] No evidence has been offered by the defendants as to why there has been an approximately four-month delay in moving to strike paragraphs of the statement of claim and, further, why they elected to deliver a statement of defence and counterclaim rather than proceed with a motion to strike. It is notable that counsel for the plaintiff gave counsel for the defendants the option of either delivering their statement of defence or a motion to strike on or before November 1, 2018. Counsel for the defendants clearly elected to deliver their clients’ pleading rather than proceed with the motion to strike.

Analysis:

[16] Rule 2.02 is the successor to what had been referred to as the “fresh step” rule: Bell v. Booth Central Healthcare Lindens Services and Robert Dacosta, [2006] O.J. No. 4646 (S.C.), at para. 5, Brown J. (as he then was).

[17] Rule 2.02 reads as follows:

2.02 A motion to attack a proceeding or a step, document or order in a proceeding for irregularity shall not be made, except with leave of the court,

(a) after the expiry of a reasonable time after the moving party knows or ought reasonably to have known of the irregularity; or

(b) if the moving party has taken any further step in the proceeding after obtaining knowledge of the irregularity.

[18] Brown J.’s decision in Bell and in his subsequent decision in Tribar Industries Inc. v. KPMG LLP, [2009] O.J. No. 959 (S.C.), were both succinctly discussed by Horkins J. in her decision in Martin v. Astrazeneca Pharmaceuticals PLC, 2012 ONSC 2744, 27 C.P.C. (7th) 32, at para. 104, wherein she states:

Both are decisions of Brown J. that involved motions to strike pleadings under Rule 21. In each case the defendant had already filed a statement of defence. In Bell, at para. 6, Brown J. stated that the “filing of a statement of defence signifies that the claim contains a recognizable cause of action to which the defendant can respond and should prevent a defendant from complaining subsequently about an irregularity in the statement of claim.”

[19] However, in Bell, because the plaintiff did not object to the defendant bringing the motion, the court allowed it to proceed: at para. 7. In Tribar, the plaintiff raised the filing of the statement of defence as a bar to the motion and the court agreed. Brown J. noted, at para 22, that “[f]or courts to condone such a manner of pleading would strip the act of pleading over of any procedural significance and risk opening the door to interminable pleadings motions even after pleadings were closed.”

[20] In the present case, the defendants raised objections to the statement of claim arising from the allegedly without-prejudice communication by counsel for the defendants having been referred to even indirectly within the body of the statement of claim. In spite of having raised that objection and being offered the opportunity to bring a pleadings motion attacking those sections of the statement of claim, counsel for the defendants elected, without any reservation, to deliver a statement of defence and counterclaim.

[21] The conclusions of Brown J., as summarized above, are most apt in the present circumstances. If the pleading of allegedly without-prejudice communication was considered offensive and an irregularity by the defendants, they should have immediately moved to attack such pleadings prior to delivering the statement of defence and counterclaim and before joining issue with the plaintiff on the allegations raised in the statement of claim.

[22] In the result, although leave to bring this pleadings motion was not sought by the defendants, having regard to the conditions in r. 2.02(a) and (b), I have concluded that leave must be denied in any event, given that the defendants clearly knew or ought to have known of the alleged irregularity in the statement of claim; they failed to provide any evidence as to the reason for the delay in moving; and, even more significantly, they chose to file the statement of defence and counterclaim joining issue with the plaintiff on the claims asserted in the statement of claim, in spite of the alleged irregularities.

[23] For these reasons, I have concluded that the defendants’ motion must be dismissed.

[24] Submissions with respect to costs shall be delivered within 15 days from the date of release of these reasons. The submissions shall be limited to 3 pages, plus a costs outline, and no reply submissions are to be filed.

Daley, J. DATE: March 15, 2019