COURT FILE NO.: 1240/16

DATE: 2019-09-04

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Sam Al Kirschner, Plaintiff

AND:

The Corporation of the Municipality of Chatham-Kent, Defendant

BEFORE: Justice R. Raikes

COUNSEL: K. Hepp, Counsel for the Plaintiff

B. Leatherdale, Counsel for the Defendant

HEARD: August 7, 2019

ENDORSEMENT

[1] The defendant seeks an order requiring the plaintiff to provide his bank records from May 16, 2009 to present. Those records were requested on the examination for discovery of the plaintiff. The request was taken under advisement and subsequently refused.

[2] The plaintiff was involved in a single vehicle accident on May 16, 2014. He alleges that on that date, he was seriously and permanently injured when the dump truck that he was driving struck a sunken catch basin on Longwoods Road. He suffered a disc herniation at L5-S1 that required spinal decompression surgery. He continues to suffer ongoing pain and other symptoms that prevent him from resuming his pre-accident activities including as owner and operator of his excavating company.

[3] The defendant argues that:

1. The requested documents are relevant to matters in issue; namely, the plaintiff’s claim for loss of past and future income;

2. The documents requested are material to determination of the plaintiff’s pre-accident income from which his post-accident income will be estimated;

3. The plaintiff’s economic loss expert assumes that income reported to Revenue Canada by sole proprietor’s like the plaintiff are unreliable and do not reflect the true income generated;

4. As a consequence, the plaintiff’s expert did not use the incomes reported by the plaintiff to Revenue Canada but estimated the plaintiff’s “adjusted” net income by adding back expenses incurred at various discounted rates;

5. The report by the plaintiff’s expert does not include detailed calculations or provide an analysis to support the amounts added to the plaintiff’s reported taxable income; and

6. The plaintiff’s bank statements will provide the foundational evidence to prove monies actually received and expenses paid which are essential to an assessment of his pre-accident income and the trajectory for future income.

[4] The plaintiff argues that:

1. The plaintiff produced his personal bank statements from April 2013 to June 2015. He did so only because they were already produced to his accident benefits insurer to calculate his income replacement benefit;

2. The plaintiff has also produced detailed income tax records, income statements, ledgers and journals covering the period 2009 through 2018;

3. The general ledger reports dating back to 2009 provide the same information concerning business transactions for the plaintiff’s business as is contained in the requested bank statements;

4. The defendant’s expert, Ms. Dalton, requested various records to complete her report. The bank statements at issue on this motion were not among the documents she requested. She did not suggest that the bank statements would be helpful in forming her opinion or that her opinion was qualified by the absence of such documents;

5. Ms. Dalton’s report was served on April 5, 2019; and

6. The production of the bank statements is superfluous and the request lacks proportionality.

[5] To be producible, the document(s) must be relevant to a matter in issue in the proceeding: r. 30.02(1). Even if relevant, the court must next consider whether the requested disclosure/production of the document(s) is proportionate: r. 29.2.03

[6] Rule 29.2.03 provides that in making a determination as to whether a document be produced or a question answered from an examination for discovery, the court must consider the following factors:

a. Whether the time required for the party to answer the question or produce the document would be unreasonable;

b. Whether the expense associated with answering the question or producing the document would be unjustified;

c. Whether requiring the party to answer the question or produce the document would cause him or her undue prejudice;

d. Whether requiring the party to answer the question or produce the document would unduly interfere with the orderly progress of the action; and

e. Whether the information or the document is readily available to the party requesting it from another source.

[7] Rule 29.2.03(2) further requires the court to consider whether the order to produce would result in an excessive volume of documents required to be produced by the party.

[8] I start with whether the documents sought are relevant to an issue in the action. Relevance is a precondition to any obligation to produce. The former relaxed “semblance of relevance” test no longer applies.

[9] I am satisfied in this case that the bank records are relevant to the plaintiff’s claim for loss of income, past and future. The bank statements will show monies received and paid out. The plaintiff was at all material times a sole proprietor. His revenues and expenses went in and out of the account. The statements provide information from which the plaintiff’s pre-accident income can be ascertained, and presumably will show his business revenues and expenses post-accident. It also allows the defendant to test the adjustments made by the plaintiff’s expert.

[10] I turn now to whether the requested production is proportionate having regard to the factors in r. 29.2.03 above.

[11] There is very little evidence of the time it would take to obtain the requested documents from the plaintiff’s bank. The defendant submits that the bank statements for the period April 2013 to June 2015 were readily available for submission to the plaintiff’s accident benefit insurer. The defendant is seeking records going back ten years, save for those statements already produced. There is no reason to believe that the request for such records will take an inordinate amount of time to obtain.

[12] Again, there is little evidence as to the cost to obtain the bank statements; however, during argument, counsel for the defendant agreed that the defendant would reimburse the plaintiff that expense.

[13] The plaintiff will not suffer “undue prejudice” if required to obtain and provide the requested bank statements. At most, he will suffer some minor inconvenience but the merits of his claim and the progress of the action will not be impaired.

[14] This matter is scheduled to be spoken to in Assignment Court in September 2019. A judicial pre-trial date and trial dates will be set then. Counsel advised that they will be seeking dates in 2021. Given the length of the civil trial list in London, a trial date earlier than the Fall of 2020 is unlikely. Thus, the order to produce is unlikely to affect the progress of the action.

[15] The information is readily available to the plaintiff from his bank. The volume of documents is not excessive.

[16] The plaintiff argues that the request is nevertheless unnecessary because the very same information found in the bank statements is found in the ledgers and journals already produced. The plaintiff relies on the following at para. 13 in Schwoob v. Bayer, 2018 ONSC 166:

The last of the five factors set out in rule 29.2.03(1) imports the notion of necessity as a factor when determining whether the production of requested documents would be proportionate. The significance of necessity as a factor in this context was indicated in the passage below from Perell J.’s decision in Drywall and Acoustic Lathing and Insulation Local 675 Pension Fund (Trustees of) v. SNC-Lavalin Group Inc., 2014 ONSC 660, [2014] O.J. No. 435 (S.C.), at para 88. That decision related to a motion to settle a disputed discovery plan, but I consider Perell J.’s observation to be equally applicable to the process of document production.

Proportionality recognizes that perfection is the enemy of the good. Naturally enough, a litigant wants to know everything that might possibly be known to prove his or her case and a litigant wants to know everything about their opponent’s case so as to not be taken by surprise and to be ready to disprove the opponent’s case. But what the litigant wants is not necessarily what he or she needs, and the development and settling of a Discovery Plan should be approached by needs not wants.

[17] In Schwoob, the plaintiffs sought production of 1.2 million documents produced in related class action litigation in the United States. Justice Lococo found the request overbroad but did require more focused production by the defendant.

[18] The scope and volume of production sought in this case is markedly different. It is tightly focused and the volume of documents is far more modest.

[19] The bank statements requested are source documents as to revenues and expenses. They will allow the amounts used as adjustments by the plaintiff’s expert to be verified or challenged. They will allow the defendant to check the accuracy of the journal entries. Those entries are the basis of the calculation of past and projected income. The plaintiff’s claim for economic loss is between $611,000 and $1,171,000.

[20] I am satisfied that the bank statements requested are relevant and the request is proportionate. Accordingly, the plaintiff is required to obtain and produce the bank statements for the period May 2009 to the present, excepting April 2013 to June 2015 which have already been produced. The expense incurred from the bank to obtain the statements shall be reimbursed to the plaintiff by the defendant.

Costs

[21] Both counsel submitted Cost Outlines dealing only with the above issue. The initial motion brought by the defendant was broader and the other issues were resolved earlier.

[22] The defendant is the successful party. Costs on a partial indemnity basis should follow. The defendant filed a factum for the motion. The motion took approximately 45-60 minutes to argue. The issue was not complex. The hourly rate is appropriate to counsel’s experience. Costs are fixed at $3,500 inclusive of disbursements and HST payable by the plaintiff.

Justice R. Raikes

Date: September 4, 2019