Court File and Parties

COURT FILE NO.: CV-16-554699

DATE: 2019-09-03

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: IOAN HUMA, ELENA HUMA, CHRISTINE HUMA, Plaintiffs

AND:

MISSISSAUGA HOSPITAL and QUEENSWAY HEALTH CENTRE (TRILLIUM HEALTH PARTNERS, ETOBICOKE GENERAL HOSPITAL (WILLIAM OSLER HEALTH SYSTEM), DR. GREGORY SUE-A-QUAN, DR. ALAN L. SHIEVITZ, DR. DEREK PEREIR, DR. DANA WILSON, DR, ROBERT J. MCBROOM, DR. MAHIN BAQI, DR. DRYSTYNA OSTROWSKA, DR. SUMONTRA CHAKRABARTI, DR. ILSE LANGE-MECHELEN, DR. CHIKKAHANUMAIAH DEVARAJ, DR MELANIE SPRING, DR. BHAVPREET DHAM, DR EDUARD BERCOVICI, DR. ERIC GEORGE DUNCAN, AND JOHN AND JANE DOE (REPRESENTING A NUMBER OF HEALTH CARE PROFESSIONALS AND/OR HOSPITAL EMPLOYEES INVOLVED IN THE CARE AND TREATMENT OF A EENY HEALTH CENTRE (TRILLIUM HEALTH PARTNERS), MISSISSAUGA HOSPITAL AND ETOBICOKE GENERAL HOSPITAL (WILLIAM OSLER HEALTH SYSTEM) FROM JUNE 14, 2014 TO SEPTEMBER 30, 2014, Defendants

BEFORE: Sossin J.

COUNSEL: Ronald Bohm, Counsel for the Plaintiffs Chris Hunter, Counsel for the Defendant Physicians Henry Ngan, Counsel for the Defendant Hospitals

HEARD: August 23, 2019

REASONS FOR JUDGMENT

OVERVIEW

[1] The defendant physicians and the defendant hospitals (collectively, the “defendants”), bring this motion to enforce a settlement under Rule 49.09 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 (the “Rules of Civil Procedure”).

[2] The plaintiff, Elena Huma, is alleged to have entered into a settlement agreement in May, 2018, by way of an email exchange, to dismiss the action against all defendants in exchange for the defendants not seeking costs against the plaintiffs for the cost of the action.

[3] Elena Huma submits that she understood the email exchange as simply a step in the negotiation of a settlement, and that after her husband, Ioan Huma and daughter, Christine Huma (collectively, “the plaintiffs”), indicated they did not wish to proceed with a settlement on those terms, the plaintiffs retained new counsel and now seek to continue their action.

[4] For the reasons that follow, I grant the defendants’ motion to enforce the settlement under Rule 49.09.

FACTS AND BACKGROUND

[5] The alleged settlement arose out of an action the plaintiffs brought against the defendants for damages in relation to Ioan Huma’s treatment by various doctors at two different hospitals in 2014, the result of which was loss of lower limb functions and other impairments.

[6] The plaintiffs contacted a lawyer, Adam Romaine (“Romaine”) to review the case and determine whether he would represent the plaintiffs. With his assistance, the plaintiffs issued a notice of action and statement of claim. While he never became counsel of record, the plaintiffs continued to forward correspondence about the case to him.

[7] The statement of claim, dated June 14, 2016, named fourteen doctors and the two hospitals where Ioan Huma received care. Ten of the doctors were served the statement of claim between December, 2016 and January, 2017.

[8] Statements of defence and crossclaims were delivered by the defendant hospitals on April 19, 2017, and by the group of the defendant doctors who had been served, dated March 2, 2018.

[9] In the Spring of 2017, counsel for the defendant physicians, Ian MacLeod (“MacLeod”), wrote to the plaintiffs to indicate he acted for the defendants and seeking to know whether the plaintiffs intended to serve the remaining four physicians mentioned in the statement of claim.

[10] In April, 2018, Romaine informed the plaintiffs that he would not formally represent them.

[11] On April 4, 2018, MacLeod contacted the plaintiffs asking whether they intended to continue their action, and if so, to schedule the remaining steps in the action.

[12] In May, 2018, Elena Huma finally contacted MacLeod and advised him that the plaintiffs had been “scammed” by Romaine and had to re-evaluate their next steps.

[13] In his response, MacLeod offered to forego costs in exchange for a dismissal of the action.

[14] On May 18, 2018, the plaintiffs wrote to MacLeod:

We are sending this email to you to inform you that we decided to dismiss this action (court file CV-16-554699), against all defendant doctors and hospitals, on a without costs basis.

Please send us confirmation that this case will be dismissed without any costs to us, and send us the court form. If we need to make any further steps to complete the matter, please let us know.

Sincerely,

Ioan Huma

Elena Huma

Christine Huma

[15] MacLeod confirmed the agreement, and sent a proposed release and consent dismissal order to the plaintiffs.

[16] On May 28, 2018, after reviewing the draft releases, Elena Huma wrote MacLeod and provided comments on what should be added to the releases (i.e. the names of the physicians who had not been served) and seeking to know whether MacLeod was providing a signed confirmation as well: “Maybe you will explain I will understand, because we don’t have any letter with your signature in relation to this, dismissal without costs of action Nr … (sic) We have only your E-mail.”

[17] The parties agree that Elena Huma called MacLeod on June 26, 2018, but the content of that call is the subject of some dispute.

[18] On June 1, 2018, the plaintiffs’ new counsel wrote to the defendants requesting time to review the matter. In September, 2018, the plaintiffs’ retained different counsel, who sought to proceed with the action.

ANALYSIS

[19] Rule 49.09 provides:

49.09 Where a party to an accepted offer to settle fails to comply with the terms of the offer, the other party may,

(a) make a motion to a judge for judgment in the terms of the accepted offer, and the judge may grant judgment accordingly; or

(b) continue the proceeding as if there had been no accepted offer to settle. R.R.O. 1990, Reg. 194, r. 49.09.

[20] On a Rule 49.09 motion, the Court of Appeal affirmed in Olivieri v. Sherman, 2007 ONCA 491 (“Olivieri”), at para. 41, that in order to enforce a settlement, the moving party must establish that the parties:

a. Intended to create a legally binding agreement; and

b. Reached agreement on all essential terms of settlement.

[21] Additionally, where the agreement is in writing, it is to be measured by an objective reading of the language chosen by the parties to reflect their agreement: Olivieri at para. 41.

[22] The plaintiffs take the position that there was no shared intention to create a legally binding agreement in these circumstances. The plaintiffs argue (at para. 23 of their factum):

23. There was no meeting of the minds. The plaintiffs did not intend a finalize a settlement agreement. Elena’s correspondence with defence counsel was understood by her to be a step towards reaching a potential resolution. Her husband was in hospital. She would have to review this with him and seek his input. Without the benefit of counsel, she felt pressure from the defence to dismiss the action. Elena emailed defence counsel that would provide a letter with all of the plaintiffs’ signatures if they wished to dismiss the action. She had no intention of dismissing the action on behalf of Ioan and Cristine without first consulting with them. She felt that in order to properly make a decision she required the proposed terms from the defendant in the form of the documents they would want signed. After reviewing the documents the plaintiffs planned to get legal advice and then decide what to do.

[23] The defendants take the position that the record demonstrates the shared intention of the parties to settle the action, and state an agreement was reached on May 18, 2018 (at para. 80 of their factum):

80. Here, the parties agreed to all essential terms of the settlement and intended it to be mutually binding:

(a) the Defendant Physicians agreed to forego costs in exchange for the Plaintiffs’ agreement to a dismissal of the Action;

(b) the Plaintiffs sent counsel to the Defendant Physicians an email formally and expressly confirming their acceptance on May 18, 2018 and asked (then and on multiple occasions thereafter) whether there were any further steps necessary to complete the matter;

(c) when counsel to the Defendant Physicians sent the Plaintiffs the draft release, the Plaintiffs sought to have it include all fourteen of the Defendant Physicians and requested either to have it signed by the Defendant Physicians or for a letter form Mr. MacLeod so that they would have proof of what had been agreed to;

(d) the Defendant Physicians sent the Plaintiffs a proposed release and consent dismissal Order to formalize the agreement. The release and the draft Order do not create the agreement, they simply reflect the terms of what had already been agreed to; and

(e) any objection to the form of the Release, dismissal Order does not vitiate the settlement. The Plaintiffs are not excused from their agreement because they refused to return executed copies of the release or the Consent to the dismissal Order (or any other document formalizing the settlement);

(f) Mrs. Huma apologized for having agreed to the without costs dismissal. This reflects her acknowledgment that a settlement had been reached.

(Emphasis in original.)

[24] In support of their position, the defendants rely on Hodaie v. RBC Dominion Securities, 2011 ONSC 6881, 2011 ONSC 1721, aff’d 2012 ONCA 796 (“Hodaie”). In Hodaie, a self-represented plaintiff agreed to settle a claim including a release. The defendant in that case sent a letter confirming acceptance of the offer and the release and encouraging the plaintiff to review the terms of the release with care and with the input of counsel. Subsequently, the plaintiff took the position that the settlement was not binding as he had not agreed to the terms of the release. Dambrot J. rejected this argument, and held:

[14] I have no doubt whatsoever that the plaintiff had finally decided to accept the settlement offered to him, and did so, on May 6, 2009, and that he subsequently regretted his decision and attempted to resile from it. The only remaining issue with respect to the settlement is the significance of the failure to settle the terms of a release.

[22] The plain fact is that a settlement agreement -- and I am satisfied that there was an agreement in this case to the essential terms of a settlement -- is a contract, and lay people are competent to enter into contracts. In this case, the plaintiff had been advised in writing when offers to settle were made in March 2008, September 2008 and December 2008 that he would have to sign a release. Once again, on May 1, 2009, the plaintiff was advised, in writing, that if he wished to accept RBC's offer, RBC might require him to sign a full and final release to evidence the resolution of this matter. After considering the matter, the plaintiff accepted the offer on May 6, 2009. When he accepted the offer, he was told that he would receive a standard release to execute, and that once it was returned, he would receive his money. He did not demur. Indeed, he followed up the next day asking for the release.

[23] It is true, as the plaintiff points out, that the release sent to him went beyond what was necessary, and that he was not obliged to sign it as drafted. But this did not entitle him to avoid the agreement. He ought to have expressed any dissatisfaction he had with it and demanded a revised release. Although he consulted counsel, he still never asked that the release be revised.

[25] The plaintiffs rely on Martin v. St. Thomas-Elgin General Hospital, 2018 ONSC 799 (“Martin”) at paras. 40-41, to argue that the release was an essential element of the agreement to settle in these circumstances. In Martin, though Raikes J. described the case as a “close call,” he concluded that all the essential elements of the agreement had not been agreed upon. In particular, he highlighted that terms remained to be agreed upon – and further negotiations were envisioned by one of the parties.

[26] In this case, while the wording of the releases remained to be finalized, there is no evidence that further negotiations were envisioned. Elena Huma’s account of what occurred after her email of May 18, 2018, suggests further approvals were needed from her husband and daughter, and never obtained, but there were no additional items up for discussion. The terms, which consisted of dismissing the action in exchange for being shielded from any costs, were clear and agreed upon as of Elena Huma’s May 18, 2018 email.

[27] I find the email of May 18, 2018 and surrounding correspondence and evidence did constitute an agreement of the essential elements of the settlement. The releases, while containing some important commitments with respect to confidentiality and, in the case of the defendant hospitals, the requirement to seek or waive independent legal advice, did not constitute essential elements of the settlement agreement.

[28] As in Hodaie, I find the releases constituted the mechanism for implementing the settlement, but did not form part of the settlement itself.

[29] As Daley J. stated in Morant v. Sun life Assurance Company of Canada, 2014 ONSC 2876 (“Morant”) at para. 34, parties are to be held to their bargains and to settlements which they negotiate and conclude.

[30] In Morant, Daley J. set out that when a settlement agreement is found to exist, a court may choose not to enforce the settlement where there is evidence that:

(a) the resulting agreement and settlement was unconscionable, fraudulent or based on a party’s misapprehension of a material fact which was known to the opposite party;

(b) the solicitor representing the party was not retained or did not have authority to settle the action and this limitation was known to the opposite party; and

(c) the party lacked the legal or mental capacity to enter into the settlement agreement at the material time.

[See Milos v. Zagas (1998) 1998 CanLII 7119 (ON CA), 38 O.R. (3d) 218; Sher v. Paletta, 1996 CanLII 286 (ON CA); Vanderkop v Manufacturers Life Insurance Company, 2005 CanLII 39686 (ON SC)]

[31] In this case, the plaintiffs are neither alleging a lack of capacity nor that a lawyer acted without authority. Therefore, only the first element of the test could apply in this case, and of the possible grounds, only unconscionability could arise on the record before me.

[32] The four elements of the test for unconscionability are:

(i) a grossly unfair and improvident transaction; and

(ii) victim’s lack of independent legal advice or other suitable advice; and

(iii) overwhelming imbalance in bargaining power caused by victim’s ignorance of business, illiteracy, ignorance of the language of the bargain, blindness, deafness, illness, senility, or similar disability; and

(iv) other parties knowingly taking advantage of this vulnerability.

Thompson v. Rogers Communication Inc., 2013 ONSC 6975 at para. 22.

[33] In this case, apart from the lack of independent or other suitable advice, which is not a freestanding defence to a settlement, the other indicia of unconscionability do not appear to be established in the record.

[34] The settlement itself is neither grossly unfair nor improvident on its face. There is no evidence in the record indicating the likelihood that the plaintiffs would succeed in establishing liability and an entitlement to damages. All that is known is that one lawyer, Romaine, considered the merits of the case and declined to represent the plaintiffs, while their current counsel has agreed to represent them and presumably has a more optimistic view. In these circumstances, the first criterion of unconscionability is not met.

[35] There is no evidence of the plaintiffs’ vulnerability. Elena Huma, the only one of the plaintiffs to give evidence in this case, is well-educated, worked for the City of Toronto and taught part-time at Seneca College.

[36] Further, there is also no basis in the record to suggest that the plaintiffs were either rushed or pressured to enter into the settlement. MacLeod stated that he wanted to set the timetable for the litigation, and when he learnt from Elena Huma that the plaintiffs had been “scammed” by Romaine, MacLeod made the offer of the dismissal in exchange for seeking no costs. There is no indication that MacLeod or the defendants attempted to take advantage of any vulnerability on the part of the plaintiffs.

[37] I find insufficient evidence on which to base a finding of unconscionability.

[38] Finally, the plaintiffs argued that it would be contrary to the interests of justice to enforce the settlement agreement. Ioan Huma is the injured party, having lost most of the functioning in his legs, and based on Elena Huma’s evidence, never agreed to the settlement, nor was consulted. This claim conflicts with the email of May 18, 2018, which is signed by all three plaintiffs, stating “We are sending this email to you to inform you that we decided to dismiss this action.” (Emphasis added.)

[39] Without evidence from Ioan Huma himself, and without other evidence in the record corroborating that Elena Huma had no authority to speak for the other plaintiffs, I am not prepared to find that the settlement should not be enforced as unjust.

[40] I accept that the plaintiffs at some point after the May 18, 2018 email changed their minds and decided they wished to pursue the action against the defendants. At that point, they acted promptly to seek legal counsel in June, 2018, and after retaining their current counsel, by September, 2018, were prepared to continue the litigation.

[41] At that point, the defendants could have unwound the settlement agreement and agreed to see the litigation proceed, with costs against the plaintiffs still a possibility. Instead, they have chosen to enforce the settlement through this Rule 49.09 motion.

[42] In light of the analysis above, I find that a settlement agreement in this case was reached, and that this settlement is enforceable. Therefore, I grant the defendants’ motion.

COSTS

[43] The defendants are not seeking their costs for this motion, and I agree that costs would not be appropriate.

Sossin J.

Date: September 3, 2019