COURT FILE NO.: CV-16-553694
DATE: 20191010
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Fercan Developments Inc. and GRVN Group Inc., Plaintiffs/Responding Parties
AND:
Attorney General of Canada, Her Majesty the Queen in right of Ontario on Behalf of the Ontario Provincial Police, and Stuart Hayhurst, Defendants/Moving Parties
BEFORE: H. McArthur J.
COUNSEL: P. Bakos and W. Friedman, Counsel for the Plaintiffs/Responding Parties
J. Robichaud and H. Thompson, Counsel for the Defendant/Moving Party, Attorney General of Canada
J. Im and B. Forson, Counsel for the Defendants/Moving Parties, Her Majesty the Queen in Right of Ontario on Behalf of the Ontario Provincial Police, and Stuart Hayhurst
HEARD: November 13, 2018 and May 28, 2019
Reasons on motion for summary judgment
H. MCARTHUR J.:
Introduction
[1] After prevailing in a criminal forfeiture application in which the federal Crown unsuccessfully sought forfeiture of their properties, Fercan Developments Inc. and GRVN Group Inc. (the plaintiffs) brought actions against the Attorney General of Canada (AGC), Her Majesty the Queen in Right of Ontario on Behalf of the Ontario Provincial Police (OPP) and Detective Constable Stuart Hayhurst (collectively the defendants) claiming malicious prosecution, negligent investigation, misfeasance in public office and civil conspiracy.
[2] All three defendants now seek summary judgment. The sole argument advanced is that the claims are statute-barred as they were brought more than two years after September 11, 2013 - the date the criminal forfeiture application was dismissed.
[3] The plaintiffs counter with two arguments. First, they assert that because of a referral made by D/C Hayhurst shortly after the criminal forfeiture application was dismissed, they were forced to defend a civil forfeiture application in relation to the same properties. Once again, the plaintiffs prevailed. The plaintiffs argue that, at a minimum, the two-year limitation period should begin on June 26, 2014, the date that the civil forfeiture matter was finally completed. If this date is accepted, then the action against the AGC was started within time. The action against the OPP and D/C Hayhurst (collectively the OPP defendants), however, would be statute-barred.
[4] Second, the plaintiffs argue that the two-year limitation period should not begin until April 14, 2016, the day that the Court of Appeal upheld a significant cost award against the federal Crown for “Crown misconduct” in bringing and continuing a “completely meritless” criminal forfeiture application. If the two-year limitation period started on this date, then the actions against all three defendants were brought within time and would not be statute-barred.
[5] For the reasons set out below, I find that the actions against all three defendants were brought within the two-year limitation period and are not statute-barred. In light of that finding, there are genuine issues requiring trial and the motions for summary judgment must be dismissed.
[6] I propose to briefly outline the facts. I will then consider the applicable legal framework before turning to my analysis.
Brief Outline of the Facts
[7] The facts leading to this summary judgment motion have spawned significant litigation over the course of almost a decade. There have been numerous judicial decisions detailing the various twists and turns this matter has taken over the years. Given the narrow scope of this summary judgment motion, and my finding that the motion for summary judgment must be dismissed, I do not see any utility in setting out the entire history of this matter. Instead, I will briefly outline the key developments and dates that are necessary to evaluate when the claim was discovered and the limitation period began to run.
[8] Fercan owned the former Molson Brewery plant (approximately 450,000 square feet of space on 35 acres of land) in Barrie, Ontario. The OPP found two large-scale indoor marijuana grow operations on the Fercan property. The police also located a large amount of marijuana and evidence of a dismantled grow operation at a property owned by GRVN. While a number of individuals were found guilty of designated substance offences as a result, neither Fercan, GRVN, or their principals, were ever charged with any criminal offences.
[9] Despite the fact that neither Fercan nor GRVN had been charged, the AGC brought an application for criminal forfeiture of the Fercan and GRVN properties before Justice Peter West at the Ontario Court of Justice. The defendant D/C Hayhurst, (an OPP officer), swore two affidavits in support of the application. D/C Hayhurst also testified at the criminal forfeiture application. Before the application was decided, the Fercan and GRVN properties were sold and the proceeds were deposited with the Seized Property Management Directorate.
[10] On September 11, 2013, Justice West dismissed the Crown’s criminal forfeiture application: R. v. Fercan Developments Inc., 2013 ONCJ 826. In so doing, Justice West found that “the evidence overwhelmingly leads to the conclusion that Fercan and GRVN, or the directing minds of those corporations, are innocent of any complicity or collusion”: at para. 322. The Crown did not appeal this decision.
[11] On October 31, 2013, Fercan and GRVN brought an application before Justice West for costs.
[12] Six days later, on November 6, 2013, D/C Hayhurst referred the matter to the Attorney General of Ontario for consideration for civil forfeiture pursuant to the the Civil Remedies Act, 2001, S.O. 2001, c.28.
[13] On November 19, 2013, the parties to the criminal forfeiture proceedings appeared before Justice West, seeking, among other things, the return of the net proceeds of sale of the Fercan property. Although not a party, the provincial Crown appeared before Justice West and sought to adjourn Fercan’s application as the Crown, after receiving D/C Hayhurst’s referral, planned to move for the preservation of the Fercan property pursuant to the Civil Remedies Act.
[14] On November 20, 2013, Justice West gave oral reason in which he dismissed the adjournment application. Justice West highlighted the OPP’s failure to refer the matter to the Civil Remedies Office at any time before November 6 and expressed his concern that a reasonable inference could be drawn that the referral for civil forfeiture was an “attempt to circumvent” his ruling.
[15] The Attorney General for Ontario then unsuccessfully brought a motion to preserve the proceeds from the sale of the Fercan and GRVN properties for a future civil forfeiture hearing, which was dismissed by Vallee J. on April 23, 2014: Ontario (Attorney General) v. $4,067,685.10 in Canadian Currency (In Rem), 2014 ONSC 2537.
[16] On June 26, 2014, the motion for leave to appeal Vallee J.’s civil forfeiture decision was denied: Ontario (Attorney General) v. $4,067,685.10 in Canadian Currency (In Rem), 2014 ONSC 3915.
[17] Meanwhile, as the civil forfeiture issue was being litigated, the costs motion proceeded before Justice West. On June 25, 2014, Justice West found that the federal Crown’s decision to commence the criminal forfeiture application and its “intransigent” and “hardball” attitude throughout the proceedings amounted to a “marked and unacceptable departure from the reasonable standards expected of the prosecution”: R. v. Fercan Developments Inc., 2014 ONCJ 779, at paras. 112-113, 119. As a result of this “Crown misconduct”, he determined that costs were warranted and ultimately awarded $570,000 to Fercan and GRVN: R. v. Fercan Developments Inc., 2015 ONCJ 695, at para. 9.
[18] The AGC appealed the costs decision. On April 14, 2016, the Court of Appeal released its reasons upholding the costs decision: R. v. Fercan Developments Inc., 2016 ONCA 269. The court explained at para. 128 that costs were warranted because the federal Crown had launched a “completely meritless application”, marred by a “constant and continuing” failure on the part of the Crown to discharge its obligations.
[19] On May 31, 2016, following the release of the Court of Appeal decision on costs, Fercan and GRVN issued a Statement of Claim against the AGC.
[20] On June 15, 2016, Fercan and GRVN served a Notice of Claim under s. 7 of the Proceedings Against the Crown Act, R.S.O. 1990, c. P.27 against the OPP defendants, noting that “… the evidence submitted by Mr. Hayhurst in support of the forfeiture application, … constituted a wrong and caused our client damages” and that the “salient facts” were set out in Justice West’s decisions and the decision of the Court of Appeal.
[21] On June 22, 2016, Fercan and GRVN formally served the AGC with the Notice of Action and Statement of Claim.
[22] On September 19, 2016, Fercan and GRVN issued a Statement of Claim against the OPP and D/C Hayhurst.
[23] On January 6, 2017, Fercan and GRVN issued a consolidated Statement of Claim, joining all three defendants together.
Applicable Legal Framework
[24] Rule 20.04(2)(a) of the Rules of Civil Procedure, R.R.O. 1990. Reg. 194 provides that the court shall grant summary judgment if satisfied that there is no genuine issue requiring a trial with respect to a claim or defence. In Hryniak v. Mauldin, 2014 SCC 7, at para. 49, Karakatsanis J. explained that there will be no genuine issue requiring a trial when the judge is able to reach a fair and just determination on the merits on a motion for summary judgment. This will be the case when the process (1) allows the judge to make the necessary findings of fact, (2) allows the judge to apply the law to the facts and (3) is a proportionate, more expeditious and less expensive means to achieve a just result.
[25] In considering a motion for summary judgment, the court should first determine if there is a genuine issue requiring a trial based only on the evidence in the motion record, without using the fact-finding powers set out in rr. 20.04(2.1) and (2.2). The analysis of whether there is a genuine issue requiring a trial should be done by reviewing the factual record and granting summary judgment if there is sufficient evidence to fairly and justly adjudicate the dispute and summary judgment would be a timely, affordable and proportionate procedure.
[26] Section 4 of the Limitations Act, 2002, S.O. 2002, c. 24, Sched. B, prohibits any claim from being commenced after two years from the date on which the claim was “discovered”.
[27] A claim is discovered either when the person first knew (s. 5(1)(a)), or when a person with the abilities and in the circumstance of the person with the claim ought to have known (s. 5(1)(b)), the following:
i. that the injury, loss or damage had occurred;
ii. that the injury, loss or damage was caused by or contributed to by an act or omission;
iii. that the act or omission was that of the person against whom the claim is made; and
iv. that, having regard to the nature of the injury, loss or damage, a proceeding would be an appropriate means to seek to remedy it.
[28] Pursuant to s. 5(2), a claimant is presumed to have discovered his or her claim on the “day the act or omission on which the claim is based took place, unless the contrary is proved.” To overcome this presumption, the plaintiffs may point to evidence to establish that the claim was discovered on a different date. The presumption may be displaced by the court’s findings as to when a plaintiff subjectively knew that he or she had a claim against the defendants.
[29] Recently, in Nasr Hospitality Services Inc. v. Intact Insurance, 2018 ONCA 725, at para. 39, the Ontario Court of Appeal explained that granting summary judgment dismissing an action as statue-barred, or declaring when a claim was discovered, requires making specific findings of fact about each element set out in s. 5 of the Limitations Act.
[30] I turn now to my analysis.
Analysis
Issue One: When did the plaintiffs know (or when ought the plaintiffs to have known) that they had suffered injury, loss or damage caused by an act or omission of the defendants?
[31] A number of cases have held that the limitation period for a claim of malicious prosecution and negligent investigation begins to run on the date of the plaintiff’s acquittal: Hill v. Hamilton-Wentworth, 2007 SCC 41, at paras. 96-98; Chimienti v. Windsor (City), 2011 ONCA 16, at para. 15; Winmill v. Woodstock (Police Services Board), 2017 ONCA 962, at paras. 26 and 34; leave to appeal to SCC refused, 37933 (September 20, 2018).
[32] While there was no acquittal in this case, I agree with the defendants that the dismissal of the criminal forfeiture application is akin to an acquittal. Thus, pursuant to s. 5(2) of the Limitations Act, the plaintiffs are presumed to have discovered their claim on September 11, 2013, the date Justice West released his reasons dismissing the application.
[33] Here, the plaintiffs argue that they have rebutted the presumption, as they did not have knowledge of the material facts that gave rise to their claim against the defendants until the Court of Appeal upheld Justice West’s costs decision on April 14, 2016. I cannot agree.
[34] In my view, it is clear that as of September 11, 2013 (the date that Justice West dismissed the criminal forfeiture application) the plaintiffs knew that they had suffered injury, loss or damage that had been caused by acts or omissions of the AGC and the OPP defendants. They were aware that they were innocent third-parties who had been forced to defend their legitimate property interests in a meritless application in onerous and lengthy proceedings. They also knew, or ought to have known, that the criminal forfeiture proceedings had terminated in their favour.
[35] In arguing for costs before Justice West, the plaintiffs raised numerous complaints about the Crown’s misconduct. The arguments advanced in support of costs, were largely grounded in Justice West’s September 11, 2013 decision. Moreover, the complaints in support of costs are largely repeated in the Statement of Claims in this action.
[36] In my view, the similarity between the arguments advanced in support of costs and the Statement of Claims establishes that the plaintiffs were aware of the material facts that gave rise to their claims as of September 11, 2013. The plaintiffs did not have to wait for the Court of Appeal decision on costs to know that that they had suffered injury, loss or damage because of the acts or omissions of the AGC, the OPP and D/C Hayhurst. Thus, as of September 11, 2013, the plaintiffs had discovered their claim pursuant to ss. 5(1)(a)(i),(ii), and (iii) of the Limitations Act.
[37] I turn now to an assessment of whether, despite the fact that the claim was discoverable as of September 13, 2013, the plaintiffs did not know that a proceeding would be the appropriate means to seek to remedy any injury, loss or damage until either the civil forfeiture application was finally dealt with or the Court of Appeal released its reasons on costs.
Issue Two: When did the plaintiffs know (or when ought the plaintiffs to have known) that a proceeding would be the appropriate means to seek to remedy their injury, loss or damage?
[38] As explained in 407 ETR Concession Co. v. Day, 2016 ONCA 709, at para. 33; leave to appeal to S.C.C. refused, [2016] S.C.C.A. No. 509, s. 5(1)(a)(iv) can have the effect of postponing the start date of the two-year limitation period beyond the day when a plaintiff knows that it has incurred damage because of the defendant’s actions. Or, as Pardu J.A. put it in Presidential MSH Corporation v. Marr, Foster & Co. LLP, 2017 ONCA 325, at para. 27, s. 5(1)(a)(iv) comes into focus when the plaintiff knew or ought to have known that he or she suffered loss caused by the defendant’s act or omission but contends that the limitation period should be “suspended because a proceeding would be premature”.
[39] While the appropriate means element does not justify delaying a claim for tactical reasons, it can justify delaying a claim that is not yet “legally appropriate”: Markel Insurance Company of Canada v. ING Insurance Company of Canada, 2012 ONCA 218, at para. 34; Nasr, at para. 48-49. If a lawsuit is premature, in that it is not yet legally appropriate to start, then it cannot be said that a plaintiff knows, or that they ought to know, that a legal proceeding would be the appropriate means to remedy a loss, injury or damage for the purposes of s. 5(1)(a)(iv) and 5(1)(b)(iv).
[40] The plaintiffs contend that it would not have been legally appropriate to bring an action until, at the very least, the civil forfeiture application had been finally dealt with. The plaintiffs further argue that it would have been premature to bring an action until the Court of Appeal released its reasons on the costs issue. I will address each submission in turn.
Would it have been legally inappropriate for the plaintiffs to start their action before the civil forfeiture application had been finally dealt with?
[41] The plaintiffs argue that it would have been premature, or legally inappropriate, to bring their claims against the defendants prior to the final determination of the intertwined civil forfeiture application, as to do so would result in hastily and inappropriately-started litigation, which would have added costs and increased complexity. This, they argue, would be contrary to the purpose of s. 5(1)(a)(iv) of the Limitations Act, which is to deter needless litigation: 407 ETR, at para. 48.
[42] The defendants counter by noting that in Presidential MSH, the court described two categories of cases where it might not be legally appropriate to start a proceeding despite the claim having been discovered. The first is where the claim arose out of the professional’s alleged wrongdoing but may be resolved by the professional himself or herself without recourse to the courts, thereby rendering the proceeding unnecessary: para. 20. The second is where the plaintiff pursues another process that has the potential to resolve the dispute between the parties and eliminate the plaintiff’s loss: para. 28. The defendants argue that the facts in the present case do not fall into either category. As a result, they argue that the plaintiffs’ position that it was not legally appropriate to bring the action until the final disposition of the civil forfeiture application must be rejected. I cannot agree for three reasons.
[43] First, Presidential MSH did not purport to provide an exhaustive list of circumstances where a proceeding might not be an appropriate means: Nasr, at para. 51. In any event, as Laskin J.A. explained in 407 ETR, at para. 34, given the highly factual nature of the appropriate means test, comparisons to other cases are of limited assistance: see also Presidential MSH, at para. 18; and Nasr, at para. 46.
[44] Second, in my view, the facts in this case could be seen as the ‘flip-side of the coin’ to the second category set out in Presidential MSH. Here, rather than the plaintiffs pursuing another process that could eliminate their loss, the defendants pursued a process that, if successful, could leave the plaintiffs with little to no loss to claim. One of the key claims advanced by the plaintiffs in the present action is that they lost the benefit of the increase in value of the subject properties. If the defendants had been successful in the civil forfeiture application, it would have substantially undermined this claim for damages. Thus, although it would not benefit the plaintiffs, it would still eliminate the plaintiffs’ claimed loss.
[45] Third, there have been cases that do not fall into either category, yet courts have still held that it was premature, or not legally appropriate, to bring an action. For example, in J.C. v. Farant, 2018 ONSC 2692, the court allowed a professional negligence claim against two solicitors to proceed although it was commenced more than two years after the plaintiff had discovered his claim for the purposes of ss. 5(1)(a)(i),(ii), and (iii) of the Limitations Act. There, the plaintiff’s action against the Roman Catholic Archdiocese of Kinston was administratively dismissed for delay. The plaintiff settled his claim with the Archdiocese years after he learned of the administrative dismissal. It was only after that claim was settled that he brought the action against his former solicitors for negligence.
[46] The court found that although the plaintiff had knowledge that he had suffered injury as a result of the act or omission of his solicitors more than two years before he brought the action, there were two reasons that it was not legally appropriate for him to bring his action until the matter with the Archdiocese had settled. First, the outcome of any sexual abuse claim could significantly impact the viability of any claim against the solicitors. Second, the court noted that the delay in bringing the action was “less of a tactical decision than a pragmatic and humane one. It avoided opening up a second litigation front at a time when [the plaintiff] could, for long periods of time, barely handle the first front.”: at para. 115.
[47] There are clear differences between the facts in the present case and those in Farant. In the latter case, the plaintiff was a vulnerable individual who did not get the appropriate assistance of counsel. In contrast, the plaintiffs in the present matter are sophisticated parties who at all times were represented by counsel. That said, there are two important similarities as well.
[48] First, in the present case the civil forfeiture application had the potential to significantly affect the viability of any claim for damages against the defendants. The defendants argue that the fact that the civil forfeiture application could significantly reduce, if not eliminate, the quantum of compensable damages is irrelevant to the discovery analysis. They argue that all that is required for the purposes of discovering a claim is that the plaintiffs knew that they had suffered damage, not whether the plaintiffs knew the full extent of their damages: Hamilton (City) v. Metcalfe & Mansfield Capital Corporation, 2012 ONCA 156, at para. 54.
[49] But it is important not to conflate the considerations under the first three elements of the discoverability test with the appropriate means element set out in s. 5(1)(a)(iv). As noted above, the latter section allows the plaintiff in certain circumstances to delay a claim that has otherwise been discovered. In my view, it is proper to consider whether an outstanding court action could effectively eradicate the claim for damages when determining whether it is premature, or legally inappropriate, to bring an action. This approach is consistent with the purpose of the section.
[50] Second, while the plaintiffs in the present case were not vulnerable in the same way as the plaintiff in Farant, they were not facing ordinary defendants. Instead, they were faced with litigation brought against them by the state with all if its resources. That is, it was far from an equal playing field.
[51] As of the date of the criminal forfeiture dismissal, the plaintiffs had already been forced by the “coercive power of the state” to participate in “lengthy and onerous proceedings to defend their legitimate property interest”: Fercan ONCA, at para. 125. Yet despite Justice West’s conclusion that they were innocent of any complicity, D/C Hayhurst started the ball rolling on a civil forfeiture application, where once again the plaintiffs were obliged to defend themselves against the coercive power of the state.[^1]
[52] Given the power imbalance between the plaintiffs and the government defendants, it seems unfair to require the plaintiffs to start an action in relation to the dismissed criminal forfeiture application, while simultaneously being forced to defend a civil forfeiture application. This is especially so given Justice West’s finding that the plaintiffs were innocent of any complicity and his concern that the referral for civil forfeiture was an attempt to circumvent his ruling.
[53] Further, insisting that the plaintiffs launch their lawsuit at the same time they were defending the new civil forfeiture application would be contrary to the “practical and pragmatic” approach courts should take to minimize the “cost and complexity” to plaintiffs who claim to be injured as a result of government action: Canada (Attorney General) v. TeleZone Inc., 2010 SCC 62, at para. 18.
[54] Given the above, I am satisfied that it would not have been legally appropriate to bring an action to remedy the loss or damage suffered as a result of the acts or omissions of the defendants until the civil forfeiture application was completed. It would have been premature to require the plaintiffs to launch a lawsuit while they were embroiled in the civil forfeiture application, a related matter that might render any lawsuit unfeasible and unworthy of pursuing. Such an approach would be both unfair and contrary to the purpose of s. 5(1)(a)(iv).
[55] There is no dispute that the civil forfeiture matter was finally completed on June 26, 2014, the day the motion for leave to appeal was denied. The statement of claim against the AGC was issued on May 31, 2016, less than two years after that date. Thus, the claim against the AGC is not statute-barred.
[56] However, the statement of claim against the OPP defendants was not issued until September 19, 2016. That was more than two years from June 26, 2014, the date the leave to appeal the civil forfeiture matter was denied. Thus, the plaintiffs claim against the OPP defendants will be statute-barred unless they prevail in their argument that it was not legally appropriate to bring the action until the appeal decision on Justice West’s cost decision had been released on April 14, 2016. I turn now to an assessment of that argument.
Would it have been legally inappropriate for the plaintiffs to start actions against the defendants before the Court of Appeal released its decision upholding Justice West’s costs award?
[57] Although I have concluded that the action against the AGC was brought within two years of the conclusion of the civil forfeiture matter and thus is not statute-barred, in the event I am incorrect in so finding I will consider the arguments with respect to the Court of Appeal decision advanced by both the AGC and the OPP defendants.
[58] The plaintiffs argue that it would have been legally inappropriate for them to start actions against any of the three defendants until the Court of Appeal upheld Justice West’s costs decision. An action would be premature, they say, as there was a potential that the Court of Appeal could have profoundly disagreed with Justice West’s conclusions about the Crown’s conduct. Depending on what the court said, they may or may not have had a tenable lawsuit.
[59] The defendants argue that a costs decision in a forfeiture matter are separate and unrelated to any cause of action arising out of the forfeiture application itself. They stress that there is no known case where a civil court has relied on a costs decision from a criminal proceedings in determining the viability or merits of a claim for negligent investigation, malicious prosecution or any of the other claims advanced by the plaintiffs. This highlights, they argue, that the only decision that matters for the purposes of the limitation period is the dismissal of the criminal forfeiture application.
[60] In my view, there are three problems with this position.
[61] First, this argument ignores the fact that costs in the criminal context are highly distinct from costs in the civil context. In the civil context, costs routinely follow the cause and are assessed having regard to the factors set out in r. 57.01(1) of the Rules of Civil Procedure. In the criminal context there is a very high standard for awarding costs against the Crown and such costs are a rare and extraordinary remedy. Given how uncommon such costs awards are, it is not surprising that there are no known cases where a civil court has relied on a costs decision from a criminal proceeding when considering the merits of claim.
[62] Second, Justice West’s cost decision directly and explicitly addressed the conduct of the federal Crown in the criminal forfeiture application. His conclusion that the federal Crown should have costs awarded against them turned on his finding that the Crown conduct exhibited a marked and substantial departure from the reasonable standards expected of the Crown, not on an assessment of what amount would be fair and reasonable for the unsuccessful party to pay in the particular circumstances: Boucher v. Public Accountants Council for the Province of Ontario, 2004 CanLII 14579 (ON CA), [2004] O.J. No. 2634 (C.A.), at para. 26. Justice West’s reasons were a stark indictment on the actions taken by the Crown in the context of the criminal forfeiture application. The appeal launched by the AGC against the costs decision specifically sought to attack the findings of Crown misconduct made by Justice West.
[63] Given that, the appeal of the cost decision had the potential to impact the viability of any action flowing from the criminal forfeiture application itself. That is, if the Court of Appeal had rejected Justice West’s findings and instead concluded that the Crown acted properly, that would have seriously undermined any action brought by the plaintiffs. As set out above, in my view, a factor that might render it legally inappropriate to bring an action is where there is another ongoing proceeding that could impact on the viability of such an action. There was that potential here.
[64] Indeed, it would not be unheard of for the court to take a very different view. For example, in the well-known case of R. v. Elliott, 2003 CanLII 24447 (ON CA), [2003] O.J. No. 4694 (C.A.), at para. 166, the Court of Appeal rebuked the trial judge for making findings of misconduct against the Crown and police that were “unwarranted and unsubstantiated”. In the present case, there was a potential that the court might have similarly rejected Justice West’s findings, and instead found that the Crown and investigators had acted appropriately. Indeed, that was the position urged upon the Court of Appeal by the Crown.
[65] There was a clear risk that the Court of Appeal might reject the findings of misconduct made by Justice West. Thus, as matter of practicality and pragmatism, it would make little sense to launch a lawsuit based on allegations of misconduct, when those very allegations could be rejected by the Court of Appeal as unsubstantiated. If the plaintiffs had launched a lawsuit while the appeal was pending, it seems highly likely that nothing of substance would have happened in the case until the appeal decision was released. That is, in order to avoid unnecessary costs and wasted resources, both sides, and the court, no doubt would have waited for the Court of Appeal to render its decision before taking any significant steps in the litigation. In my view, this means that for the AGC, it was not legally appropriate to bring an action until the Court of Appeal dealt with the appeal from the cost decision.
[66] As it relates to the OPP defendants, however, they argue that they stand in a very different position from the AGC. The Court of Appeal, they argue, was considering Crown misconduct, not the conduct of the police. Thus, even if it was legally appropriate to wait for the conclusion of the appeal before bringing an action against the AGC, the plaintiffs should have started their action against the OPP defendants earlier.
[67] In my view, however, this position glosses over the connection between the OPP defendants and the federal Crown in advancing the criminal forfeiture application. There are substantial similarities between the claims advanced against the Crown and the claims advanced against the OPP defendants. The Statement of Claim issued against the OPP defendants specifically relied on Justice West’s decision and noted his concern that D/C Hayhurst’s referral for civil forfeiture was an attempt to circumvent his ruling in the criminal forfeiture matter. The claim also relied on the Ontario Court of Appeal decision. Further, the claim alleged the following:
• D/C Hayhurst left out important information from his affidavits, and the affidavits were incorrect and misleading;
• the OPP defendants’ “investigation and prosecution of the Plaintiffs directly led to the commencement and/or continuation of the Federal Crown’s meritless proceedings”;
• the OPP defendants “knew or ought to have known the Forfeiture Applications were meritless”;
• the OPP defendants, in particular D/C Hayhurst, “willfully or negligently provided false and/or misleading information to the Federal Crown concerning its own investigation of the Plaintiffs”; and
• the forfeiture application was “brought and continued dishonestly or in bad faith with the assistance” of the OPP defendants.
[68] There was a clear connection alleged by the plaintiffs between the OPP defendants and the AGC in the criminal forfeiture application. Given that, it seems apparent that the decision of the Court of Appeal could have impacted on the viability of the claim brought against the OPP defendants. That is, if the court had found that the forfeiture application had merit and that the federal Crown acted properly in advancing the application, that would have impacted on an assessment as to whether there was a feasible lawsuit against the OPP defendants.
[69] Moreover, even if the plaintiffs had started actions against the OPP defendants before the Court of Appeal ruling, it seems unlikely that the parties, or the court, would have taken steps to move the matter forward until the decision was released. I say that because it is obvious that there would be significant overlap between any trial dealing with the AGC and any trial dealing with the OPP defendants. In both, the conduct and actions of D/C Hayhurst would be assessed. He, and potentially other officers, would likely be a witness at both trials. Concerns about the proper utilization of court resources, and efforts to avoid duplication and increased costs would militate towards putting any action against the OPP on hold until such time as the Court of Appeal released its reasons.
[70] Given that, in my view it would not have been legally appropriate to bring the proceeding against the OPP defendants until April 14, 2016, the date the Court of Appeal released its decision affirming Justice West’s findings of federal Crown misconduct. The action against the OPP defendants was started on September 19, 2016, which as within two years of that date. As a result, the action against the OPP defendants is not statute-barred.
Conclusion
[71] The record allows me to make the necessary findings of fact and to apply the law to those facts. The plaintiffs discovered their claim pursuant to ss. 5(1)(a)(i),(ii), and (iii) of the Limitations Act by September 11, 2013 (the date Justice West dismissed the criminal forfeiture application); by that date, the plaintiffs knew that they had suffered damage as a result of the actions of the defendants.
[72] Pursuant to s. 5(1)(a)(iv), however, it was not legally appropriate to bring an action at a minimum until the civil forfeiture application was finally dealt with on June 26, 2014. The action against the AGC was issued on May 31, 2016, within two years of this date. Further, I also find that it was not legally appropriate, to bring an action against either the AGC or the OPP defendants until the Court of Appeal rendered its decision in the appeal from Justice West’s costs decisions. The actions against all three defendants were started within two years of that date and are thus not statute-barred. As a result, there are genuine issues requiring a trial and the motions for summary judgment are dismissed.
[73] While the Supreme Court of Canada recommended in Hryniak, at para. 78, that a judge who dismisses a motion for summary judgment should seize herself or himself of the trial, in my view there would be no benefit to my doing so in this case for two reasons. First, given my trial assignments, there would be logistical difficulties in scheduling this matter before me. Second, the only issue before me was the narrow one of whether the actions were statue-barred. I made no findings of fact on any central issues and the motion was brought in the early stages of the action: Huang v. Mai, 2014 ONSC 1156, at para. 52; Kerwin v. Manulife Financial, 2017 ONSC 7166, at para. 43.
Costs
[74] I encourage the parties to see if they can agree on costs. If the parties are unable to agree on costs, the plaintiffs shall serve and file with my office written costs submissions within 15 days. The defendants shall serve and file with my office any responding costs submissions within 15 days thereafter. The written submissions shall not exceed three pages in length, excluding the Costs Outline.
Justice Heather McArthur
Date: October 10, 2019
[^1]: The OPP defendants argue that D/C Hayhurst made the referral in accordance with his statutory duty to do so under ss. 19(4), 19(5) and 19(5.1) of the Civil Remedies Act, 2001, S.O. 2001, c. 28. Given the narrow limitation issue before me on this summary judgment motion, I do not need to delve into whether, given Justice West’s findings in the criminal forfeiture application, the officer was, in fact, obliged to refer the matter to the Attorney General of Ontario.