COURT FILE NO.: CV-13-479211

MOTION HEARD: 20190913

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Wendy Sokoloff and Wendy Sokoloff Professional Corporation, Plaintiffs

AND:

Sanjay Bateriwala, Barjinder Kalsi, Barjinder Kalsi Law Professional Corporation carrying on business as BK Personal Injury Law, Harwinder Kalsi, Complete Rehab Centre and Surakasha Assessment Centre Inc., Defendants

BEFORE: Master Jolley

COUNSEL: H. Jack Parsekhian and Juliano Pichini, Counsel for the Moving Party Plaintiffs

Ted Kalnins, Counsel for the Responding Party Defendants Barjinder Kalsi, Barjinder Kalsi Law Professional Corporation carrying on business as BK Personal Injury Law, Harwinder Kalsi and Complete Rehab Centre

Vladimira M. Ivanov, Counsel for the Responding Party Defendant Surakasha Assessment Centre Inc.

Caroline Ursulak, Counsel for the Responding Party Defendant Sanjay Bateriwala

HEARD: 13 September 2019

REASONS FOR DECISION

[1] On 26 April 2018, the Registrar issued an order dismissing this action for delay. The plaintiffs bring this motion to set that order aside. Applying the Reid factors, in order to succeed, the plaintiffs must (a) provide a reasonable explanation for the delay; (b) satisfy the court that the deadline was missed through inadvertence; (c) demonstrate that this motion was brought promptly; and (d) rebut the presumption of prejudice. If the presumption is rebutted, the burden then shifts to the defendants to demonstrate they would suffer actual prejudice should the dismissal order be set aside (see Reid v. Dow Corning Corp. 2001 CarswellOnt 2213). The order sought is a discretionary one.

[2] In Jadid v. Toronto Transit Commission 2016 ONCA 936, the court stated as follows:

It is well established that, as stated by the motion judge, none of the Reid factors have automatic priority over any others. The Reid test provides a structured approach to reconciling the principle that civil actions should be decided on their merits, with the principle that the public interest is served by enforcing procedural rules that promote the timely and efficient resolution of disputes (1196158 Ontario Inc. v. 62474013 Canada Ltd., 2012 ONCA 544, 112 O.R. (3d) 67, at para. 18). It guides the exercise of judicial discretion and thereby reduces the risk of overlooking relevant considerations. It does not set out a formula, prioritize any enumerated factors over any others, or categorically exclude the consideration of other factors not listed: H.B. Fuller Co. v. Rogers, 2015 ONCA 173, 386 D.L.R. (4th) 262, at para. 23; Marché d’Alimentation Denis Theriault Ltée v. Giant Tiger Stores Ltd., 2007 ONCA 695, 87 O.R. (3d) 660, at para 20.

[3] The analysis is a contextual one which considers the overall dynamics of the litigation to determine what is just in the circumstances (Carioca’s Import and Export Inc. v. Canadian Pacific Railway 2015 ONCA 592 at paragraph 46 and Scaini v. Prochnicki 2007 ONCA 63 at paragraph 23).

Have the plaintiffs provided a reasonable explanation for the delay?

[4] Considering the first Reid factor, on the evidence before me I am not satisfied that the plaintiffs have provided a reasonable, acceptable or satisfactory explanation for the delay. To the contrary, it is difficult to find any instance during the six year life of this action where the plaintiffs met the timelines either agreed upon by the parties or imposed by the Rules.

[5] The events that give rise to this action occurred prior to and in early 2011. In their statement of claim issued in 26 April 2013, the plaintiffs seek damages for what they say was the improper solicitation of existing and potential clients of the firm.

[6] The beginning stages of the action were marked by a failure of the plaintiffs to respond to requests made of them. A week prior to 28 August 2013 counsel for the defendant Surakasha Assessment Centre Inc. (“Surakasha”) left a message for the plaintiffs to discuss the claim. He did not receive a reply. As a result, he served a demand for particulars on 28 August 2013 asking what specific cause of action was alleged against his client, what facts were alleged in support of that allegation and what damages were alleged. He did not receive a reply to the demand. On 2 December 2013 he sent a follow up email concerning the demand for particulars, asking for a reply by December 5. He did not receive a reply. On 31 December 2013 he served a request to inspect documents and a further demand for particulars concerning the allegations of conflict of interest and the date the plaintiffs said the actions in question came to their attention. Rule 30.04(3) requires a party to respond forthwith to a request to inspect documents and to make the document available within five days of service of the request. In this instance, the plaintiffs did not respond to the request to inspect or to the correspondence from defence counsel. In the face of the lack of response, Surakasha brought a motion to strike the statement of claim as disclosing no cause of action against it. The motion was successful and the statement of claim was struck as against that defendant with leave to amend.

[7] The draft amended statement of claim was served in September 2014 and all pleadings were served by the end of 2014. (As a result of an administrative issue, the amended statement of claim was not formally issued until 20 April 2015.) Thereafter the action sat. Nothing occurred at all for more than a year after the amended statement of claim was issued and more than one and a half years after it had been served in draft and defences served. Then, on 11 July 2016 the plaintiffs sent a letter canvassing dates for examinations for discovery.

[8] Counsel for the Kalsi defendants wrote in response that he required the plaintiffs’ affidavit of documents before agreeing to dates. The plaintiffs did not respond to that letter and did not serve an affidavit of documents (and still have not). The plaintiffs advised on this motion that a clerk started working on a draft affidavit in July 2016, more than three years after the action was commenced. To date, it has not been served, let alone reviewed by counsel of record.

[9] Thereafter, nothing happened on the file for another five months, when in December 2016 the plaintiffs sent correspondence advising they intended to bring a motion to strike the defence of Surakasha and serving a notice of motion returnable in March 2017. No motion record was ever served and the motion never proceeded. These two letters – 11 July 2016 and 21 December 2016 - are the only times the file was touched between April 2015 and January 2019.

[10] The plaintiffs argue that they had to regularize the Surakasha pleading before they could move to discoveries and that those discoveries were delayed to give Surakasha time to either appoint new counsel or obtain an order granting it leave to be represented by someone other than a lawyer. This is not borne out by the evidence. Even if the plaintiffs thought striking the Surakasha defence was the reasonable next step, they never took it. Further, they never contacted Surakasha at the address in the removal order to discuss its status and their intention to move to strike its defence if it did not appoint counsel. In fact, the record discloses that Surakasha never heard from the plaintiffs from May 2015 until receipt of the December 2016 letter and then again from December 2016 to late January 2019.

[11] The plaintiffs also explained that in 2017 the firm was busy with FSCO hearings and with responding to the alleged absconding of clients by another group of lawyers in the firm. This is not a reasonable explanation for not moving an action past the pleadings stage in five years. If the firm was stretched, it could have retained outside counsel or devoted some minimal resources from another matter to this action (Chisholm v. Bell Canada 2018 ONSC 2942 at paragraph 13). At best, this would only explain delay in 2017 in any event.

[12] Finally, the plaintiffs argue that the complexity of the action contributed to the delay. That is not so. There was no attempt to move this action, whether complex or straightforward, through even the preliminary documentary discovery stage. The number of parties or complexity of issues did not impede its progress in any way.

[13] The action was administratively dismissed by order made 26 April 2018 and received by the plaintiffs on or about 9 May 2018. At that time, the plaintiffs had not delivered their affidavits of documents. No timetable had been proposed and no discoveries arranged. The plaintiffs had written all of two letters. The action was just barely out of the gate.

[14] On the record before me, there is no reasonable explanation for this lengthy delay.

Have the plaintiffs shown that the deadline was missed through inadvertence?

[15] The defendants argue that the plaintiffs have not provided an explanation for the delay and it must, therefore, be presumed that the failure to set the action down was intentional. They also argue that this conclusion can be inferred from the plaintiffs’ conduct.

[16] In the affidavit filed in support of the motion, Ms. Sokoloff deposed that “it has always been the plaintiffs’ intention to prosecute this matter and remain dedicated to same.” As noted above, there are no facts that support this intention. It is just a statement on paper, six years after the issuance of the original statement of claim.

[17] The further evidence of the plaintiffs on this issue is a statement from Ms. Sokoloff that the firm had not properly diarized the set down date and it was overlooked inadvertently. She further states “the plaintiffs have always intended to set the action down within the time limit set out in the Rules of Civil Procedure, but failed to do so through inadvertence.” Again, the evidence does not support this bald statement. This is not the case where the usual steps in an action, such as documentary and oral discovery, had taken place but the deadline to set it down for trial was inadvertently missed. This action was not set down because it was nowhere near being ready to be set down for trial in early 2018. The date may not have been diarized but, in fact, virtually nothing had happened since the statement of claim was issued.

[18] In the interim, all outward activity pointed to the plaintiffs abandoning the action. Sonia Bains (“Bains”) was a director and officer of Surakasha and had been the office manager of the defendant Complete Rehab, to the plaintiffs’ knowledge. The statement of claim alleged that Surakasha and Complete Rehab were involved in a conspiracy with the other defendants to harm the plaintiffs. In late 2016 Bains was looking for a law clerk placement. Believing that the 2013 action had been abandoned, she approached Ms. Sokoloff, whose office was close to where Bains lived, for a job. Bains was hired and worked for the plaintiffs for some months in 2017, both paid and unpaid. At no time did the plaintiffs raise the topic of the litigation. During that time, Bains had access to the firm’s client files, which circumstance would have reinforced her understanding that this action, which alleged theft of clients and confidential information, had been abandoned. Bains also attended a retirement party at the office in the spring of 2018 and, again, no mention was made of this 2013 action. It was reasonable for the defendants to assume that the plaintiffs had chosen to put these issues behind them. If the plaintiffs’ concerns had continued, it would be difficult to square them with hiring a director of Surakasha and former employee of Complete Rehab, both of which were alleged to have conspired to harm the plaintiffs.

[19] The plaintiffs argued that the defendants had taken no steps to move the matter forward and had also not complied with their obligations to serve affidavits of documents. As noted by the Court of Appeal in 1196158 Ontario Inc. v. 6274013 Canada Ltd. 2012 ONCA 544, “failing any initiative on the part of the plaintiff, to require the defendants to spend time and money to prepare for a case that, from all appearances, was dead on the vine would, in my view, be to impose an unnecessary and unreasonable burden.”

[20] I am not satisfied that the deadline to set the action down was missed through inadvertence.

Did the plaintiffs move promptly to set aside the dismissal order?

[21] The action was administratively dismissed approximately 16 months ago.

[22] The plaintiffs admit they that received the dismissal order on or about 9 May 2018. Ms. Sokoloff indicated that she planned to have another lawyer in her office assign it to a new lawyer who was to start at the firm at the end of May. Had that taken place, the dismissal order would have sat for at least three weeks, without even a letter to the defendants.

[23] But that did not happen. The new lawyer arrived at the end of May and, it seems, was not assigned the task of bringing this motion. When he then left a few months after his arrival, the motion remained unassigned. This was not discovered until December 2018, eight months after the dismissal order had been received.

[24] The first concrete step the plaintiffs took after receiving the dismissal order in May 2018 was on 30 January 2019 when they served a notice of motion with a return date of 22 February 2019. The date was set without consultation with the defendants and was adjourned to accommodate their schedules.

[25] The parties then agreed to a timetable for the motion to be heard on 23 July 2019 which included cross examinations the week of June 17. While the plaintiffs’ recitation of the chronology ends there, the defendants’ cross examination of Ms. Sokoloff disclosed that the motion did not proceed on the agreed date as she was in court on another matter on the dates that had been agreed upon for cross examinations. The motion was then adjourned to be heard 13 September 2019. The parties again agreed on a timetable. As part of the timetable, the plaintiffs were required to serve any reply affidavits at least five days before the cross-examinations, that is, by 30 July 2019. It also required the plaintiffs to file their memorandum of fact and law by 23 August 2019. Both deadlines were missed. The plaintiffs served a supplementary motion record, which was in fact a reply record, and a factum, both on 26 August 2019, after Ms. Sokoloff had been cross-examined on August 8.

[26] The supplementary affidavit seems to have been intended to put into evidence information that had been omitted from Ms. Sokoloff’s original affidavit. She had additional documents in front of her at her cross-examination but the defendants chose not to ask any questions about them. As the defendants did not rise to the bait, the plaintiffs attempted to introduce the new documents into evidence by way of re-examination.

[27] The plaintiffs did not seek leave to admit the supplementary affidavit on this motion, as required under rule 39.02(2). Had leave been requested, I would not have been satisfied that this is one of those exceptional cases that warrants resort to rule 39.02(2) (Brock Home Improvement Products Inc. v. Corcoran 2002 49425 (ON SC), [2002] O.J. No. 931 at paragraph 8). Nor is there evidence to meet the four part test set out in First Capital Realty Inc. v. Centrecorp Management Services Ltd. 2009 CarswellOnt 6914 (Ont. Div. Ct.) for granting leave. In particular, there was no evidence to explain why the documents were not included in the original affidavit or in a reply affidavit served in accordance with the timetable.

[28] Further, I am not satisfied that the re-examination on these new documents was an examination on a matter raised by the defendants on cross examination, as required by Rule 39.03(2).

[29] For these reasons, I have not relied on the plaintiffs’ supplementary motion record.

[30] The court stated in Shome v. Apotex 2012 ONSC 5708 at paragraph 29:

The third Reid factor requires the plaintiff to demonstrate that he moved forthwith to set aside the dismissal order as soon as it came to his attention. Being busy with other work cannot justify a lawyer taking no steps to serve the notice of motion immediately. A dismissal order cannot be taken lightly. It commands immediate attention. If a lawyer does not have time to take on new work he should not take it on. If a lawyer is faced with a dismissal order, setting it aside should be his first priority given the strong language of rule 37.14. If he does not have time to draft a motion record, he should retain other counsel to do so …

The delay in moving to set aside must be viewed in the context of all relevant circumstances, including other delay in the action. The 11 month delay in serving a motion is in my view further evidence of the approach taken by the plaintiff’s lawyer …. While I found that contextually there was an acceptable, if tenuous, explanation for the litigation delay prior to the set down deadline (the plaintiff’s illness), the same cannot be said for the delay in serving a motion. The plaintiff has failed to satisfy the third Reid factor.

[31] The same can be said on the facts of this case. While there are cases where a two year delay was accepted by the court, it was in the context of an action where the court was able to conclude that the lawsuit had been proceeding reasonably promptly (Finlay v. Van Paassen 2010 ONCA 204 at paragraph 29). That is not the case here. The failure to serve a notice of motion for almost nine months after receiving the dismissal order is consistent contextually with the delay that led up to the dismissal. On the facts before me, I am not satisfied that the plaintiffs moved promptly to set aside the dismissal order.

Have the plaintiffs rebutted the presumption of prejudice?

[32] The plaintiffs state that they “believe that the defendants would not be prejudiced by restoring the action. I verily believe that all parties are represented by counsel, and all witnesses who would be called to testify at the trial of this matter remain available, and the evidence intended to be relied upon is still in the parties’ possession…. I do believe that the disposition of this matter by way of a fair trial continues to be possible, and I do not believe that the defendants would be hindered in their ability to defend the within action if it was restored.”

[33] The deponent does not state who those witnesses are or that they have preserved all relevant documents. In fact, one relevant piece of evidence that was in the possession of the plaintiffs is no more, which I will address below.

[34] The plaintiffs argued before me that the witnesses are all within the knowledge of the defendants as the plaintiffs cannot themselves know which clients otherwise would have come to their firm but for being diverted by Bateriwala to BK Personal Injury Law. While the plaintiffs cannot know all of those “lost” clients, the amended statement of claim alleges that the plaintiffs came to know that Bateriwala was actively soliciting the plaintiffs’ existing clients. Ms. Sokoloff stated on her cross examination that clients of the firm were calling her to tell her that Bateriwala was approaching them to change law firms and they wanted to know what was going on. The names of those clients are within the knowledge of the plaintiffs and should have been disclosed and confirmation that those witnesses are still available and still remember the events in question should have been provided as part of the plaintiffs’ “belief” that “all witnesses who would be called to testify at the trial of this matter remain available”.

[35] The amended statement of claim also alleges that specific physical files have gone missing. Ms. Sokoloff stated on cross examination that files had “disappeared from her office without explanation”. She should have been able to identify on this motion the list of those files that were in their office but had disappeared, allegedly taken by Bateriwala. I understand that the plaintiffs have never provided the defendants with this information.

[36] Kalsi deposes that the failure of the plaintiffs to provide the names of any clients has jeopardized the ability of the Kalsi defendants to defend the action. They would need to review every file over a still undefined period of time and try to recall the circumstances that brought those clients to BK Personal Injury Law. Further, they would have to see if those clients are still available and whether they have any recollection of how they came to the firm.

[37] Lastly, the amended statement of claim alleges that Bateriwala took confidential information with him. A list of that information that was taken has never been provided and was not listed on this motion.

[38] There was one key piece of evidence in the custody of the plaintiffs that has gone missing, namely Bateriwala’s Blackberry phone. On that phone, allegedly, were Blackberry messages (“BBMs”) that support the plaintiffs’ assertion of a conspiracy among the defendants to spirit clients away from the plaintiffs. When Bateriwala left the firm, the plaintiffs took the Blackberry he used and on which these allegedly incriminating BBMs were kept. On cross examination, Ms. Sokoloff asserted that she could prove the defendants’ conspiracy through the BBMs she saw on Bateriwala’s phone. However, she then indicated that she did not preserve any screenshots or copies of the BBs and she has since disposed of the phone.

[39] Kalsi deposed that in March 2016 his firm suffered an IT crash. While many files were recovered, his personal BBM saved images were not. It is these images that the plaintiffs say are relevant to the action. While the loss did not arise during the delay after the dismissal order was received to the date of the motion, i.e. from May 2018 to January 2019 (MDM Plastics Ltd. v. Vincor International Inc. 2015 ONCA 28, paragraph 25), had the plaintiffs moved with some dispatch, the parties could have concluded the exchange of affidavits of documents and productions and likely completed examinations for discovery before that evidence was lost.

[40] Plaintiffs’ counsel argues before me that the loss of Bateriwala’s Blackberry cannot constitute prejudice to the defendants or impact their ability to have a fair trial, as it only harms the plaintiffs’ ability to prove their case. While the plaintiffs may suffer the primary impact, the loss of evidence also impacts trial fairness, not only to the parties, but to the administration of justice itself (Fasken Martineau DuMoulin LP v. Elliott 2018 ONSC 3880 at paragraph 53). The BBMs have disappeared, leaving the plaintiffs challenged in proving their case and the defendants prejudiced in responding to any alleged recall by the plaintiffs of the content of those BBMs. According to the plaintiffs’ evidence on this motion, those BBMs are key to the allegation of conspiracy and I find that the parties cannot fairly proceed to trial on that issue with non-existent productions on that point on events that now occurred at least eight years ago.

Conclusion

[41] On motions such as this, the court must balance the preference to have civil actions decided on their merits against the promotion of timely resolution of actions (H.B. Fuller Co. v. Rogers, supra at paragraph 25) and the importance of finality of litigation (Marché d'Alimentation Denis Thériault Ltée., supra at paragraphs 37-38). I am also guided by the provisions of Rule 1.04(1) of the Rules of Civil Procedure which provides that these rules shall be liberally construed to secure the just, most expeditious and least expensive determination of every civil proceeding on its merits.

[42] I have considered the imposition of a timetable as requested by the plaintiffs. However, in light of the consistent failure to follow the timelines under the Rules for delivery of their affidavit of documents, for responses to requests to inspect, for service of motion records and even the failure to follow the consent timetable for the delivery of materials for this motion, I have no confidence that a timetable would be adhered to.

[43] Looking at the case contextually and considering the overall dynamics of the litigation to determine what is just in the circumstances, on the facts of this case, the preference to have actions determined on their merits is outweighed by the promotion of timely resolution of disputes and the finality of litigation. The motion is dismissed.

[44] The parties have filed costs submissions for the motion. They shall attempt to resolve the costs of the action and the motion. If they cannot do so by October 15, they may each file a costs outline and bill of costs for the costs of the action by email to my assistant trial coordinator, Ms. Meditskos at christine.meditskos@ontario.ca by 18 October 2019.

Master Jolley

Date: 19 September 2019