Court File and Parties

COURT FILE NO.: CV-12-461531 DATE: 20200430 SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Rachel Irwin McLaughlin, a minor under the age of eighteen (18) years by her Litigation Guardian Lesley Ann McLaughlin, Lesley Ann McLaughlin personally, Chareese McLaughlin and Curtis Irwin, Plaintiffs AND: Loblaws Inc. and John Doe, Defendants

BEFORE: Darla A. Wilson J.

COUNSEL: Nicholas Kapelos, Counsel for the Plaintiffs

HEARD: In writing

Endorsement

[1] This is an action for damages brought by the Plaintiff Lesley McLaughlin stemming from an incident that occurred at a Loblaws store on August 21, 2010. Ms. McLaughlin alleges she sustained an ankle injury when an employee at Loblaws pushed a cart into her heel.

[2] The Statement of Claim was issued on August 16, 2012. Included in the claim were Ms. McLaughlin’s two daughters: Chareese who was born in 1995; and Rachael who was born in 2000. The daughters claimed damages pursuant to the Family Law Act as a result of the injury to their mother, who was the Litigation Guardian for Rachael for these proceedings, as she was a minor.

[3] In February 2018, the solicitor for the Plaintiffs, Mr. Kapelos, filed a motion pursuant to Rule 7 of the Rules of Civil Procedure for approval of the proposed settlement of the minor. It was proposed that the claims of the daughters be dismissed without any payment. In his affidavit in support of the motion, Mr. Kapelos deposed that the proposed settlement was entered into in December 2017.

[4] In an endorsement dated May 2, 2018, Justice Matheson refused to approve the settlement. She noted the materials filed were deficient as there was no information included in the solicitor’s affidavit or in the affidavit of the Litigation Guardian which explained why the claims of Rachael should be dismissed without any payment. She also noted that Minutes of Settlement were not included in the motion materials, which did not comply with Rule 7.08(4)(d). Finally, Justice Matheson ordered that supplementary materials could be filed by June 15, 2018 failing which the motion would be dismissed.

[5] Importantly, Justice Matheson in her endorsement noted that while Rachael had recently attained the age of 18, “the proposed settlement of her claim was reached when she was a minor and approval is therefore required.”

[6] Nothing was received from Mr. Kapelos in response to the endorsement of Justice Matheson. In my capacity as team lead for Rule 7 matters in Toronto, I reviewed this motion record. I issued an endorsement on March 20, 2020 in which I noted that no further materials had been filed pursuant to Justice Matheson’s endorsement. I ordered the solicitor for the Plaintiffs to immediately advise of the status of the settlement, to serve my endorsement on counsel for the Defendant and to advise whether funds had been disbursed notwithstanding the lack of court approval.

[7] In a letter dated April 15, 2020, Mr. Kapelos acknowledged that he had received and reviewed the order of Justice Matheson dated May 3, 2018. He decided not to submit further materials to remedy the deficiencies, but rather to allow his motion to be dismissed on June 15, 2018, obtain an order to continue since Rachael had attained the age of 18 years and simply dismiss the action on consent, without obtaining court approval. He disbursed funds to the main Plaintiff in June 2018. He obtained an order dismissing the action on June 27, 2018.

[8] In his response to me, Mr. Kapelos advised that he obtained the consent of defence counsel to proceeding in this fashion, it was the most expeditious manner of disposing of the case and he felt it unnecessary to obtain court approval since Rachael had turned 18.

[9] The manner in which Mr. Kapelos handled this Rule 7 motion is unacceptable. Clearly, the settlement was negotiated in December 2017, a time when Rachael was a minor. In her endorsement, Justice Matheson specifically addressed the timing issue and noted that if the Plaintiff was a minor at the time the settlement was entered into, the proposed settlement required court approval. Mr. Kapelos was aware of this requirement, because he brought the motion for approval in February 2018.

[10] The fact that by the time he received the endorsement of Justice Matheson in May 2018 Rachael had attained the age of 18 years is of no moment. Mr. Kapelos knew the settlement had not been approved because of the deficiency in the materials he filed. Instead of remedying the deficiencies, Mr. Kapelos chose to ignore the endorsement of Justice Matheson, obtain an order to continue and obviate the need for court approval. He never even bothered to respond to the endorsement of Matheson J.

[11] The fact that defence counsel agreed with his approach to securing the dismissal order is irrelevant; Mr. Kapelos knew his materials were deficient, he knew the court had refused to approve the proposed settlement and he decided to do an “end run” to avoid having to submit further materials to the court. This flagrant breach of the requirements of Rule 7 is unacceptable and is disrespectful to the court process of requiring approval of potential settlements for persons under disability.

[12] In Mills v. Raymond, 1997 CarswellOnt 4075 (Ontario Court of Justice, Divisional Court), a case which was cited by Justice Matheson in her endorsement, the Court noted, “While rule 7.06 provides for a minor, on obtaining majority, to obtain an order to continue proceedings personally, the rule does not remove the mandatory provision for court approval of offers made during minority.” [Emphasis added]. That is exactly the situation here.

[13] The appropriate response to the Order of Matheson J. would have been to submit proper materials to enable Her Honour to determine if a dismissal of the minor’s claim was appropriate on the facts of this case. Alternatively, Mr. Kapelos ought to have written to Justice Matheson to advise of his plan, given that Rachael had attained the age of majority and obtained approval from the Court. To simply ignore a court order is never acceptable, and to devise a plan to obviate the need to provide further materials is not acceptable either. The fact that the minor was not intended to receive any funds from the settlement is irrelevant. Mr. Kapelos issued the claim with Rachael as a minor, the settlement was entered while she was a minor and consequently, it required court approval. What is troubling is that Mr. Kapelos was specifically advised by Justice Matheson that the fact that Rachael had turned 18 did not mean court approval was not required. Regrettably, he chose to ignore the law and the provisions of Rule 7.

[14] Mr. Kapelos is directed to the Superior Court of Justice website which contains the Best Practice Guidelines for Rule 7 motions and applications.

Darla A. Wilson J.

Date: April 30, 2020