SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Durham Condominium Corporation No. 123
v.
Watts Water Technologies, Inc. and Watts Water Technologies (Canada) Inc.
BEFORE: MASTER R. A. MUIR
COUNSEL: S. Erentzen for the plaintiff L. Lorimer for the defendants
REASONS FOR DECISION
The plaintiff seeks further and better affidavits of documents. It also requests answers to questions refused at the defendants’ examination for discovery. Finally, the plaintiff asks for an order requiring the defendants’ witness to re-attend at a continued examination for discovery. The defendants are opposed.
This action arises out of the alleged failure of a flexible water supply connector tube (the “Connector”) attached to a toilet in unit 1105 located in the plaintiff condominium. The plaintiff alleges that the failure of the Connector resulted in significant water damage. It is claiming damages of approximately $70,000.00 in this simplified procedure action.
The plaintiff alleges that the defendants were the manufacturers, distributors and vendors of the Connector. The plaintiff claims damages based in negligence, nuisance and breach of contract.
The defendants deny the plaintiff’s allegations. The defendants have pleaded, among other things, that they were not the manufacturer, distributor or vendor of the Connector. They deny that they had any contractual relationship with the plaintiff or anyone else through which the plaintiff could recover damages as a third-party beneficiary.
The defendants have each served affidavits of documents. The affidavit of documents of the defendant Watts Water Technologies, Inc. (“Watts US”) lists no documents in schedule A. The affidavit of documents of the defendant Watts Water Technologies (Canada) Inc. (“Watts Canada”) lists two documents in schedule A.
A representative of the defendants was examined for discovery on November 1, 2016. A number of undertakings were given, and several questions were refused.
Part of the defendants’ examination dealt with a class proceeding in the United States which appears to involve alleged failures of coupling nuts on toilet connectors (the “US Class Action”). The defendant Watts US was a party to that class proceeding. Watts Canada was not a party.
The US Class Action has settled. The settlement agreement is a public document and was filed with the United States District Court on January 31, 2014 (the “Settlement Agreement”). Watts US is a party to that settlement agreement which was signed by counsel for Watts US.
The Settlement Agreement states, among other things, that the US Class Action involved extensive discovery, including “the Watts Defendants’ production of over one hundred twenty-five thousand pages of documents” and the exchange of numerous expert reports.
The plaintiff argues that the defendants’ affidavits of documents are obviously deficient. They list very few documents. The plaintiff points to the US Class Action as evidence of missing documents. It argues that the subject matter of the US Class action is similar in nature to this proceeding and it resulted in the production of 125,000 pages of documents by the Watts defendants, one of which is a defendant in this action. The plaintiff therefore seeks an order requiring the production of the documents produced by the Watts defendants in the US Class Action, along with the expert reports exchanged in that proceeding.
The defendants take the position that they have produced all relevant documents. They submit that they did not manufacture, distribute or sell the Connector in issue in this action and therefore the documents from the US Class Action are simply not relevant, especially in view of the 2010 amendments to the Rules of Civil Procedure, RRO 1990, Reg. 194 (the “Rules”) which changed the test for the production of documents from semblance of relevance to the narrower test of relevance. The defendants submit that the principle of proportionality also favours their position. They point out that this is a $70,000.00 simplified procedure action. Rule 76 sets out strict time limits for the conduct of oral examinations and narrows the scope of production. The defendants’ evidence suggests that the cost to have a third-party e-discovery provider host and review the documents requested by the plaintiff would be at least $190,000.00. The defendants suggest that this request by the plaintiff is nothing more than a fishing expedition.
Having considered the arguments of the parties, I have reluctantly concluded that the production of the US Class Action documents is required in the circumstances of this proceeding.
The parties are in general agreement on the test to be applied on a motion seeking an order for the service of a further and better affidavit of documents in a case such as this. The applicable principles are well summarized in Master Sandler’s frequently cited decision in Bow Helicopters v. Textron Canada Ltd., [1981] OJ No. 2265 (SCJ – Master). The important principles that emerge from that decision applicable to this action can be stated as follows:
● it is common in a product liability action for the defendant to possess a large volume of documents with a plaintiff having little or no information;
● evidence that simply amounts to intuition, speculation and guesswork is insufficient to justify an order for the service of a further and better affidavit of documents;
● there must be evidence that specific documents exist.[^1]
Of course, simply identifying the existence of documents is not enough. The documents must be relevant, and the requested production must satisfy the proportionality requirements of Rule 29.2.03.
It is clear from the Settlement Agreement that the 125,000 pages of documents exist. The Settlement Agreement specifically states that they were produced by the “Watts Defendants”. The Settlement agreement defines the “Watts Defendants” to include Watts US, a defendant in this action. The defendants’ evidence on this motion is that Watts US did not produce any documents as part of the US Class Action. However, that evidence is inconsistent with the language of the Settlement Agreement. In any event, there is no suggestion in the defendants’ evidence or in their answers to their undertakings and refusals, that the 125,000 pages of documents are not within their possession, control or power.
The US Class Action involves a claim arising from the failure of coupling nuts on toilet connectors. The toilet connectors in issue in the US Class Action appear to be very similar to the Connector in issue in this action. They have common features such as being labelled with the name “Watts”, a white coupling nut and the printed words “hand tight only”. In my view, it is not necessary, for the purposes of this discovery motion, that the plaintiff prove the Connector in this case is the same as the connectors in issue in the US Class Action. It is enough if the plaintiff provides evidence to support a reasonable inference that the parts may be the same. In my view, the plaintiff has done so and has established the relevance of the requested documents, at least for discovery purposes.
I am mindful that this is a simplified procedure claim for the payment of $70,000.00 and the plaintiff wants the defendants to produce 125,000 pages of documents. Proportionality is an important consideration under the Rules. However, the Rules should not be interpreted in a manner that effectively prevents a plaintiff from ever proving its case. As Master Sandler noted in Bow Helicopters it is common for a plaintiff in a products liability case to have little or no information. The defendant will generally have most of the relevant documentary evidence. See Bow Helicopters at paragraph 5. This is not a case where the defendants have produced at least some volume of records consistent with the value of the plaintiff’s claim. The defendants have made almost no production. Unfortunately, the court is faced with a very stark choice on this motion. In my view, a just result requires that an order be made that will allow the plaintiff a reasonable opportunity to prove its claim.
The burden this order places on the defendants can be partially obviated by imposing terms on the manner of production. I note as well that the defendants’ evidence about the cost to host and review the documents refers to 125,000 “records” and not 125,000 pages of documents. Presumably, the actual number of records is less than 125,000.
I accept that the defendants feel strongly about their defence of this action. Their evidence is that they did not manufacture, distribute or sell the Connector. They say they had nothing to do with the leak in Unit 1105. However, it is not the role of the court on this motion to determine the matters in issue in this action. That is a matter for the trial judge or perhaps a motion for summary judgment. This discovery motion must be decided based on the allegations in the pleadings and not by deciding which party is most likely to succeed in the end.
I am therefore ordering that Watts US produce to the plaintiff for inspection the 125,000 pages of documents referred to as being produced by the Watts defendants in the Settlement Agreement for the US Class Action. To partially address proportionality concerns, these documents may be produced as they presently exist without the requirement for Watts US to formally list and describe the documents in Schedule A to its affidavit of documents. As well, for the reasons associated with the proportionality concerns set out above, I am not prepared to order the production of expert reports from the US Class Action.
The balance of the relief on this motion is adjourned without a date. Counsel may contact me directly by email if any difficulty arises with respect to this order or to arrange for a new date for the continued hearing of this motion.
The registrar shall not dismiss this action without further order of the court.
2019 08 19
Master R. A. Muir
[^1]: See Bow Helicopters at paragraphs 5 to 9.