COURT FILE NOS.: CV-15-540309, CV-15-543298, CV-15-536536-A1

DATE: 2020 01 22

SUPERIOR COURT OF JUSTICE - ONTARIO

IN THE MATTER OF the Construction Act, RSO 1990, c. C.30, as amended

RE: SCHINDLER ELEVATOR CORPORATION, Plaintiff

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WALSH CONSTRUCTION COMPANY OF CANADA, BONDFIELD CONSTRUCTION COMPANY LIMITED, WALSH CONSTRUCTION/BONDFIELD PARTNERSHIP and WOMEN’S COLLEGE HOSPITAL, Defendants

AND RE: WALSH CONSTRUCTION/BONDFIELD PARTNERSHIP, Plaintiff

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ZURICH INSURANCE COMPANY LTD, Defendant

AND RE: WALSH CONSTRUCTION/BONDFIELD PARTNERSHIP, WALSH CONSTRUCTION COMPANY CANADA and BONDFIELD CONSTRUCTION COMPANY LIMITED, Defendants

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SCHINDLER ELEVATOR CORPORATION and ZURICH INSURANCE COMPANY INC., Third Parties

BEFORE: Master Todd Robinson

COUNSEL: P.E. Du Vernet, L. Wang and J. McClelland, for Schindler Elevator Corporation and Zurich Insurance Company Ltd.

F. Bogach, K. Thavaraj, and P. Conrad, for Walsh Construction Company of Canada, Bondfield Construction Company Limited, Walsh Construction/Bondfield Partnership

HEARD: January 20-21, 2020

SUPPLEMENTARY REASONS FOR DECISION (Admissibility of Statements in Trial Affidavit Evidence)

[1] These reasons are further to earlier reasons for decision regarding the pre-trial motions for determinations on the admissibility of trial affidavit evidence brought by each of Schindler Elevator Corporation (“Schindler”) and Walsh Construction Company Canada, Bondfield Construction Company Limited and Walsh Construction/Bondfield Partnership (collectively, “WBP”). They address the outstanding Schindler objection to the entirety of the affidavit of Gary Lemna sworn September 30, 2019 (the “Lemna Affidavit”), which I reserved to supplementary reasons when issuing my prior decision in Schindler Elevator Corporation v. Walsh Construction Company of Canada, 2020 ONSC 433.

[2] Schindler seeks an order striking the entire Lemna Affidavit on the basis that it comprises entirely inadmissible or irrelevant evidence. Schindler challenges Mr. Lemna’s evidence on several bases, including:

(a) Mr. Lemna fails to say he had any involvement or personal knowledge of what he deposes, including what involvement, if any, he had in obtaining the performance bond and whether and how he received any information from site;

(b) Mr. Lemna fails to indicate if he knew about the issues identified when they arose;

(c) Mr. Lemna provides opinion and conclusory statements without information supporting his views. For example, Schindler points to the indemnity clause in the subcontract as one of “particular importance” at para. 6 and comments on what Zurich Insurance Company Ltd. (“Zurich”) was “required” to do by the terms of the performance bond at para. 13;

(d) Mr. Lemna gives no foundational evidence on the instructions he received in writing the correspondence regarding which he deposes;

(e) Mr. Lemna cites and purports to interpret various provisions of Schindler’s subcontract and the performance bond;

(f) Mr. Lemna tenders and discusses correspondence with Zurich that has no relevance to the litigation or determinations at trial; and

(g) There was no production of Mr. Lemna’s instructing and other emails, with the result that cross-examination will be the first time that Schindler learns about underlying facts.

[3] WBP submits that the Lemna Affidavit deals with WBP’s claims against Zurich, that Mr. Lemna was involved and gives evidence on the letters he wrote and correspondence he received or had with Zurich and its adjuster. WBP argues that Zurich’s failure to respond to the bond claims by WBP is evidence forming part of WBP’s claim against Zurich, regarding which Mr. Lemna has been called to give evidence. WBP further submits that discoveries did occur between WBP and Zurich and were completed in writing by agreement of the parties. WBP submits that Schindler and Zurich had the opportunity to examine WBP on the issues regarding the claims against Zurich, including the letters and emails to which Mr. Lemna is referring in his affidavit, all of which were produced. Essentially, as I understand the argument, WBP’s position is that Schindler cannot now complain about production of documents that that it now claims are relevant, but never previously requested or asserted were relevant and producible.

[4] I do not accept Schindler’s argument regarding documentary production of Mr. Lemna’s instructions and related emails or correspondence. There is nothing before me regarding what was produced or suggesting that those types of documents are clearly relevant and were not produced. There is similarly nothing before me to support that Schindler and Zurich could not reasonably have argued at an earlier stage that they would be relevant based on the discovery evidence obtained and knowledge that Mr. Lemna was involved in some capacity. To the extent that Mr. Lemna’s instructions or any arguably relevant and unproduced documents have now become genuine issues of dispute, the Rules of Civil Procedure address such circumstances, and they may be the proper subject matter of a voir dire or further trial motion. However, I lack sufficient basis to consider what was or was not addressed in the course of documentary and oral discoveries in assessing whether to strike the Lemna Affidavit.

[5] Given that the entirety of Mr. Lemna’s evidence is challenged as being inadmissible, I have reviewed the Lemna Affidavit in detail. I am satisfied that the Lemna Affidavit should not be struck in its entirety, although substantial portions should be struck. My determinations are as follows:

(a) paras. 15-17, 19, 22-26, and 28-36: I am satisfied that Mr. Lemna has personal knowledge and involvement in the matters addressed in these paragraphs, either by direct involvement in the communications or by being copied on them. I do not agree with Schindler that the evidence is clearly irrelevant. Zurich’s response to the claims made on the performance bond is a factual issue that must be considered in assessing the issue of Zurich’s compliance with its obligations under the bond, if a finding is made that those obligations were triggered. Other paragraphs merely represent Mr. Lemna’s understanding of the content of the documents. These paragraphs are admitted without prejudice to argument on their weight.

(b) paras. 2-5, 14, 18, 20-21, 27, and 37: I am satisfied that, based on the language used and with reference to the emails, letters and notices attached, the affidavit evidence does not support that Mr. Lemna had relevant contemporaneous knowledge of the facts to which he is deposing. In making that determination, I have also reviewed the referenced correspondence to confirm that Mr. Lemna was not listed as being copied on them. In the absence of such foundation, I am not satisfied Mr. Lemna is competent to give evidence on these matters. No explanation was provided for why Ms. Kowert (to and from whom much of the correspondence was sent) has not been or cannot be called in respect of the correspondence. Much of this evidence has also already been tendered in other affidavits, so there is no necessity for Mr. Lemna to depose regarding it. I do not accept WBP’s position that many of these facts are simply “part of the narrative.” It is generally not proper for a witness who does not have personal knowledge of certain matters to tender evidence on them. These paragraphs are accordingly struck.

(c) paras. 6-13 and 39: These paragraphs contain improper legal interpretation, opinion and conclusions, as well as argument, on issues to be determined by the court. Mr. Lemna is not tendered as an expert, so his interpretations and opinion of contractual clauses is inadmissible. These paragraphs are accordingly struck.

(d) para. 38: In my view, although framed as a summary of the subject email, the summary provided amounts to argument regarding the interpretation to be given to the email. The paragraph is accordingly struck.

Orders

[6] For the foregoing reasons, I order as follows:

(a) The following paragraphs or portions of paragraphs in the Lemna Affidavit are hereby struck: paras. 2-14, 18, 20-21, 27, and 37-39.

(b) The remainder of the Lemna Affidavit shall be admitted into evidence without prejudice to subsequent argument as to weight.

(c) WBP shall amend the court copy of the Lemna Affidavit to reflect the order made above prior to it being marked as an exhibit. Striking shall be reviewed and verified by Schindler and Zurich prior to the affidavit being re-filed, which shall be at least two (2) days prior to Mr. Lemna’s viva voce examination.

(d) This order is effective without further formality.

MASTER TODD ROBINSON

DATE: January 22, 2020