Court File and Parties
COURT FILE NO.: CV-15-527178
DATE: 20200821
ONTARIO SUPERIOR COURT OF JUSTICE -
B E T W E E N:
Luigino Arconti et al., Plaintiffs
– and –
Ian Ross Smith et al., Defendants
BEFORE: F.L. Myers J.
COUNSEL: Andrew Jia, for the Plaintiffs
Sean Dewart, for the Defendants
HEARD: August 19. 2020
endorsement
Background
[1] On August 14, 2020, Mr. Dewart requested a case conference because he had been contacted by Mr. Jia to seek the defendants’ consent to an adjournment of the mini-trial scheduled for three days commencing August 26, 2020. The mini-trial is being held to complete a motion for summary judgment heard first in late January of this year.
[2] The court convened the case conference by telephone on August 19, 2020. During the case conference, Mr. Jia advised that he has been retained by the plaintiffs solely to seek an adjournment of the mini-trial. The plaintiffs request the adjournment because they recently discharged their prior lawyer as a result of a breakdown of the relationship among them. Mr. Jia submits that the plaintiffs need three months to find a new lawyer. He advises that his retainer is limited to seeking the adjournment. He will not be counsel at the mini-trial if it proceeds. He submits that the defendants will suffer no prejudice if an adjournment is granted. Mr. Jia submits that any costs thrown away should be payable in the cause (i.e. to the parties who are ultimately successful on the motion for summary judgment).
[3] Mr. Dewart opposes the adjournment request. He argues that it is not made in good faith. Rather, he refers to several prior, last-minute, tactical maneuvers that he says were made by the plaintiffs. He submits that this is a further step in a strategy of chronic obstruction and delay by the plaintiffs.
[4] Mr. Dewart also notes that the defendants are lawyers and have significant trial commitments commencing in October. If this matter is not heard by the end of September, he submits, his clients will not be available until the new year. In addition, he seeks $25,000 in costs thrown away as he and his co-counsel have been busy preparing for the mini-trial including preparing with their expert witness (also a lawyer). In all, he submits that the process to get this mini-trial scheduled has been torturous and the defendants are entitled to have this matter behind them.
[5] I agree with Mr. Jia that I should not look behind the circumstances of the breakdown of the relationship between the plaintiffs and their lawyer. I have no basis to find that the plaintiffs fired their lawyer in bad faith.
[6] My task is to balance the interests of the parties and the administration of justice to inform the exercise of my discretion in the overall interests of justice in the fair, efficient, affordable, and proportional resolution of this civil dispute on its merits. See: Turbo Logistics Canada Inc. v. HSBC Bank Canada, 2016 ONCA 222 at para. 27 and Hryniak v Mauldin, 2014 SCC 7 at para. 28.
[7] In my view, for the reasons discussed below, the interests of justice require that the mini-trial proceed as scheduled and that the adjournment request be denied.
The Relevant Factors
[8] In Turbo Logistics, the Court of Appeal discussed the proper approach to adjournment requests in civil matters as follows:
[18] The applicable principles are well understood. They were expressed by this court in Khimji v. Dhanani (2004), 2004 CanLII 12037 (ON CA), 69 O.R. (3d) 790, per Laskin J.A. dissenting, but not on this point, at para. 14:
A trial judge enjoys wide latitude in deciding whether to grant or refuse the adjournment of a scheduled civil trial. The decision is discretionary and the scope for appellate intervention is correspondingly limited. In exercising this discretion, however, the trial judge should balance the interests of the plaintiff, the interests of the defendant and the interests of the administration of justice in the orderly processing of civil trials on their merits. In any particular case several considerations may bear on these interests. A trial judge who fails to take account of relevant considerations may exercise his or her discretion unreasonably and if, as a result, the decision is contrary to the interests of justice, an appellate court is justified in intervening. In my opinion, that is the case here.
[19] Laskin J.A. observed that in refusing an adjournment, the trial judge should have taken into account the goal expressed in r. 2.01(1)(a), namely “to secure the just determination of the real matters in dispute” and the resolution of cases on their merits.
[20] Khimji was considered by this court in Toronto-Dominion Bank v. Hylton, 2010 ONCA 752, which adopted the above statement. This court observed, at para. 36, that “[t]he presiding judge has a well-placed and a well-established discretion to decide whether an adjournment request ought to be allowed or denied.” After setting out the above statement, the court added, at para. 37:
Laskin J.A.'s passage makes it clear that, in reviewing highly discretionary decisions such as whether to allow a request for an adjournment, the inquiry must focus on whether the court below took account of relevant considerations in balancing the competing interests and made a decision that was in keeping with the interests of justice.
[21] The court added that factors to be considered include the reason for the adjournment request, the history of the matter, the prejudice to the party resisting the adjournment and the consequences to the requesting party of refusing the request. The fact that a party is self-represented is a relevant factor as the court has an obligation to ensure that all litigants have a fair opportunity to advance their positions.
[9] In Turbo Logistics, the Court of Appeal also referred with approval to the non-exhaustive list of considerations identified by Perell J. in Ariston Realty Corp. v. Elcarim Inc., 2007 CanLII 13360 (ON SC) at para. 34:
[34] Depending on the circumstances of each case, to judicially exercise the discretion to grant or refuse an adjournment, a judge or master may need to weigh many relevant factors including:
▪ the overall objective of a determination of the matter on its substantive merits;
▪ the principles of natural justice;
▪ that justice not only be done but appear to be done;
▪ the particular circumstances of the request for an adjournment and the reasons and justification for the request;
▪ the practical effect or consequences of an adjournment on both substantive and procedural justice;
▪ the competing interests of the parties in advancing or delaying the progress of the litigation;
▪ the prejudice not compensable in costs, if any, suffered by a party by the granting or the refusing of the adjournment;
▪ whether the ability of the party requesting the adjournment to fully and adequately prosecute or defend the proceeding would be significantly compromised if the adjournment were refused;
▪ the need of the administration of justice to orderly process civil proceedings; and
▪ the need of the administration of justice to effectively enforce court orders.
Procedural History
[10] The plaintiffs have sued the defendants for negligence in their handling of an OSC hearing in 2013. They sued Mr. Fenton for recommending that they use the services of his partner Mr. Smith for the hearing. They sued Mr. Smith for negligently failing to advise them properly concerning their chances of success at the OSC hearing thereby depriving them of the opportunity to accept pre-hearing settlement offers. They also sued him for negligent conduct of the hearing itself.
[11] The mini-trial deals only with the issues of negligence related to Mr. Smith’s advice about settlement offers before the OSC hearing. I previously dismissed the allegations concerning Mr. Smith’s handling of the hearing.
[12] The defendants served their motion record seeking summary judgment in January, 2017. This motion has a complex procedural history as it was stayed while the plaintiffs appealed the OSC decision to the Divisional Court. That appeal was dismissed on January 5, 2018.
[13] On March 27, 2018 counsel for the parties attended before Cavanagh J. in Civil Practice Court. He ordered the plaintiffs to deliver their responding material for this motion within two weeks of a dismissal of their motion for leave to appeal from the Divisional Court to the Court of Appeal (should that come to pass).
[14] The Court of Appeal dismissed the motion for leave to appeal on May 18, 2020. The plaintiffs did not deliver their responding motion material within two weeks as they had been ordered to do.
[15] On August 17, 2018, the plaintiffs applied for leave to appeal to the Supreme Court of Canada from the order of the Court of Appeal denying them leave to appeal from the order of the Divisional Court dismissing their appeal from the OSC decision.
[16] That same day, at a case conference, and on consent of counsel for the parties, Cavanagh J. ordered the plaintiffs to deliver their responding material for this motion within two weeks of the decision by the Supreme Court of Canada on their leave to appeal application. He required the defendants to deliver any reply evidence within a further two weeks and cross-examinations to be held within a further 30 days.
[17] On March 14, 2019, the Supreme Court of Canada dismissed the application for leave to appeal. The plaintiffs did not deliver their responding motion material within two weeks as they had been ordered to do.
[18] Another case conference was held on April 2, 2019. The Arcontis attended without counsel before D.A. Wilson J. She scheduled the summary judgment motion to proceed on August 21, 2019. She endorsed:
With respect to a timetable, I order responding materials to be served and filed by 6 May 2019. The plainitffs object advising they need to retain an expert to opine on the standard of care. I am not prepared to extend the time for the delivery of the responding materials beyond 6 May 2019. This action was commenced in 2015 and the plaintiffs knew an expert report was necessary in order to prove their claim against the defendants. Further Cavanagh J. has previously made endorsements requiring delivery of responding materials 2 weeks after the dismissal of the appeals. The plaintiff[‘s application for] leave for appeal to Supreme Court of Canada was dismissed 14 March. Rest of timetable is approved.
[19] On April 15, 2019, the plaintiffs asked the Supreme Court of Canada to reconsider the dismissal of their application for leave to appeal. The court dismissed the request on June 24, 2019.
[20] On June 27, 2019, the plaintiffs asked the Supreme Court of Canada to reconsider again and on July 11, 2020, it declined again.
[21] The plaintiffs’ counsel then advised that he was getting off the record. The plaintiffs retained counsel on a limited retainer basis to attend CPC to seek to adjourn the motion for summary judgment. The case conference was adjourned to allow new counsel for the plaintiffs time to prepare. On August 14, 2020, Cavanagh J. endorsed:
A follow-up case conference was held today, further to the case conference on August 9, 2019. The plaintiffs will retain Mr. Ayres as their new counsel. Under the circumstances, I vary the scheduling order of Wilson J. which, in my view, is necessary for a just adjudication of the defendants’ motion for summary judgment.
This motion is adjourned from August 21, 2019 to September 16, 2019 for 1/2 day.
[22] A further case conference was held before Cavanagh J. on September 24, 2019. At that time, he endorsed:
By endorsement dated August 14, 2019, I made an order varying the schedule for the defendants’ motion for summary judgment. This variation was made at the request of the plaintiffs and was opposed by the defendants. The revised schedule called for the plaintiffs to deliver any [additional] responding material including any expert report by September 15, 2019. This was a Sunday, so this material was due on September 16, 2019.
The plaintiffs did not comply with the scheduling order, and they did not request any indulgence from the court. Counsel for the defendants arranged a case conference with me.
I allow one final variation of the scheduling order which the parties consent to. Their revised schedule is...
This timetable is fixed and made on consent. Defendants’ counsel asked that the December 16, 2019 motion date be made peremptory to the parties and counsel for the plaintiffs agreed. I so order.
[23] On October 2, 2019, the date set by Cavanagh J. for delivery of the plaintiffs’ expert report, the plaintiffs’ counsel advised that the plaintiffs would not be delivering expert evidence on the motion.
[24] On October 17, 2019, during cross-examination of the defendants’ expert witness, the plaintiffs discharged their second counsel. The cross-examinations were adjourned.
[25] On November 15, 2019, the date set by Cavanagh J. for delivery of the plaintiffs’ factum, the plaintiffs did not deliver a factum. Instead, they delivered an expert report despite the advice of their prior counsel that they would not be doing so.
[26] The motions could not be heard on December 16, 2019 as there was no judge available. They came on before me on January 23, 2020. Each of the plaintiff brothers was represented by separate counsel for that hearing without leave. One was represented by limited retainer counsel whose mandate was so limited that he sought instructions on an issue-by-issue basis throughout the day. He could not argue costs of the motion for his client and he advised that it was beyond the scope of his retainer to provide a blank form of Costs Outline for his client to fill-in himself.
[27] Mr. Bastien had been recently retained and appeared for the other Arconti brother on the motion.
[28] I released my decision granting the defendants’ motion to strike some causes of action under Rule 21 and requiring a mini-trial for the rule 20 summary judgment issues. I convened a case conference on February 4, 2020 to schedule this mini-trial. I endorsed the following that day:
Mr. Bastien is counsel for all plaintiffs now. He asks me to defer the summary trial ordered on the basis that, if the plaintiffs successfully appeal the decision under R. 21 dismissing their claims premised on undermining the results of the OSC and Divisional Court hearings, an interim summary trial on the duty to warn and whether defendants were negligent for failing to push plaintiffs to settle or to clearly advise them to do so would be duplicative and inefficient.
Mr. Dewart argues that the summary judgment motion is not yet completed. A result is still required on the settlement issues regardless of the outcome of the R. 21 issues.
Mr. Bastien repeated the point that was argued on the R. 21/R. 20 motion that the negligence issue on settlement was discrete from the issues of whether defendants caused the hearing to be lost unjustly by their failures to deal properly with admissions, Mr. Smith's failure to prepare the parties as witnesses, and defendants failure to disclose numerous conflicts of interest that led them to sacrifice the plaintiffs’ interest in favour of others. Mr. Cooper argued at the hearing of the motions that due to privilege asserted by the OSC, issues concerning settlement could not be raised at the Divisional Court. I noted that the issue of whether counsel was negligent in failing to advise the clients to settle is not an issue on an appeal from the OSC decision in any event.
I do not see the overlap between the conduct that is alleged to have led to a wrong outcome at the OSC and neglect in failing to advise more clearly or strongly that plaintiffs should settle. The speculative allegations that defendants threw the hearing have no impact on settlement advice. Negligence in the lawyers’ conduct of the OSC hearing similarly post-dates and is distinct from factual issues surrounding settlement advice or the lack thereof.
I also agree with Mr. Dewart that the case has been outstanding for a long time. If it can be resolved by summary judgment (for a reference on damages or dismissal) either aids moving forward. If any issues dismissed under R. 21 become live again, document discovery of defendants will have been largely done and discrete add-ons will not represent duplication or overlap.
In my view, the balance of convenience and the interests of efficient, proportional justice weigh in favour of proceeding.
Mr. Bastien advises that he needs two weeks to amend the statements of claim to limit them in accordance with the January 27, 2020 order. The plaintiffs are granted leave to amend their statements of claim to file fresh as amended statements of claim limited to allegations of negligence related to the duty to warn concerning settlement only by February 19, 2020. The defendants shall deliver amended statements of defence if so advised by February 28, 2020.
On consent the defendants will provide electronic versions of their file to the plaintiffs within ten (10) days. The plaintiffs will deliver copies of all documents on which they propose to rely at the summary trial to defendants’ counsel no later than two weeks before the trial management conference to be scheduled by me.
On March 4 2020, plaintiffs may conduct an examination for discovery on Messrs. Smith and Fenton for up to two hours each. I can be contacted to resolve summarily any issues with questions asked or refusals made at a case conference under rule 50.13(6).
The trial is booked for up to three (3) days on May 27 - 29, 2020. Mr. Bastien is to deliver trial records by March 6, 2020. Counsel are to arrange a pre-trial before another judge by contacting Ram.J.Sharma@ontario.ca. I will deal with trial management issues myself. The pre-trial is to focus on resolution.
Counsel are to agree on two or three dates during the week of March 9, 2020 when they are available for a case conference at 8:30 a.m. by telephone. Counsel will provide the dates to my Assistant who will book the case conference. The purpose of the case conference will be to resolve summarily any outstanding issues that develop between now and then and to begin discussion of trial management by orders under R. 50[.13(6)]. Counsel should discuss a trial schedule involving pre-trial delivery of any further affidavits and experts reports (if any). There should also be written openings and legal submissions. Counsel should expect brief oral examinations in chief to acclimatize witnesses; limited cross examinations, and closing submissions relating facts to the law. All else should be in writing, in advance, and preferably delivered electronically in an agreed format or e-protocol. Any significant objections should also be tabled before the trial.
Of course, this schedule is subject to any order that the Court of Appeal may make…
[29] On February 28, 2020, I extended the time for delivery of pleadings and scheduled the cross-examination of Mr. Fenton. I noted that the plaintiffs waived any further cross-examination of Mr. Smith.
[30] The hearing of the mini-trial was postponed due to the Covid-19 pandemic. Efforts to re-schedule the mini-trial took place in July. Counsel were available the week of August 24, 2020. The court also had availability due to the deferral of other proceedings due to the pandemic. The plaintiffs’ legal expert was due to be in Vancouver on a matter that week. So, discussions were held about ensuring that she could testify before or after her court proceedings which would fit quite conveniently with the time zone difference.
[31] On July 30, 2020, I endorsed:
The mini-trial that I ordered on January 27, 2020 is scheduled for three days on Aug 26 – 28, 2020 by Zoom unless both counsel agreed to attend court.
On August 26, 2020, the defendants will produce Messrs. Smith, Fenton, and Campbell for cross-examination. Each witness may be examined-in-chief for up to 15 minutes as “warm-up”. Mr. Bastien will determine how much time to spend with each witness with the proviso that he must finish all cross-examinations by the end of that day. On August 27, 2020, the plaintiffs will produce Messrs. L. Arconti and [A]. Arconti and Ms. Taylor for cross-examination. There will be the same 15-minute entitlement for examination-in- chief and Messrs. Dewart and Belanger will determine their timing provided they are finished all cross-examinations that day.
Oral argument will be heard on August 28, 2020. Counsel agreed there will be no further factums or written submissions filed by either side.
[32] The prohibition against further factums and submissions was made on consent of both counsel and emanated from the plaintiffs’ history of filing late materials in past hearings.
[33] As noted above, the plaintiffs discharged Mr. Bastien last week.
[34] Several points emerge from the history of this matter:
a. This lawsuit is five years old and concerns a hearing that commenced seven years ago. I said last February that this litigation had been outstanding for a long time;
b. The procedural history is both lengthy and complex. It is studded with delays and failures to comply with scheduling orders by the plaintiffs;
c. Substantial efforts have been made by all parties to prepare for a heavily case-managed mini-trial. As a result of the various scheduling orders and multiple case conferences over the past few months, the written work is done. All that remains is cross-examination of witnesses who have all been cross-examined out of court already. These examinations are not discoveries at large. They will be short because the points in issue are very narrow at this stage. The parties have quite rightly focused on the duty to warn – what should Mr. Smith have told the Arcontis about their chances of success and settlement prior the OSC hearing and what did he tell them?
d. The plaintiffs have been represented in this proceeding by at least three fully retained counsel and three limited-scope retainer counsel;
e. The plaintiffs have been self-represented at times. At times one will purport to be represented while the other is not. They use self-representation or representation by limited-scope retainer counsel strategically. At all times they have participated heavily in the proceedings and directed counsel closely – holding especially tight reins on limited retainer counsel;
f. The plaintiffs want a three-month adjournment to retain counsel. With the defendants’ commitments, that effectively means a five-month delay;
g. The plaintiffs offer no costs thrown away; and
h. The court has set aside this time which is serendipitously available. We do not know yet how trials times will play out in the fall with jury and non-jury trials generally re-commencing in September.
Analysis
[35] The principle goals of civil justice are to provide a fair and just decision on the merits through efficient, affordable, and proportional means. I know from having seen and heard the Arcontis in court and in conferences that they have strong knowledge of the facts and issues. They do not have counsels’ advocacy skills or depth of knowledge of the law to be sure. But they will not be lost at sea on their own. They have the ability to participate meaningfully if they cannot find counsel to their liking.
[36] Natural justice – the right to notice of the facts and issues and to present them to the court- is certainly being provided. The whole purpose of the mini-trial is to ensure procedural and substantive fairness when the documentary evidence did not allow me to find the facts necessary to apply the applicable law. The Arcontis cannot complain with being self-represented when they have done so by choice when it has suited.
[37] While normally plaintiffs wish to move forward and the defendants have the impetus to delay proceedings, the reverse is the case in this proceeding. The defendants have been pushing to have their motion for summary judgment heard since March, 2018. They have brought on the case conferences each time the plaintiffs have failed to meet a scheduling order. It is the plaintiffs who have deferred scheduling several times to the point of being found by Cavanagh J. to have breached his order. They did so again delivering several late affidavits, an expert report, and factums in the lead-up to the hearing of the motion.
[38] The defendants are entitled to end their jeopardy. They are entitled to be held liable or not liable and to close the books on the 2013 hearing. The plaintiffs should be compensated if they are entitled to it before the passage of time denudes a judgment of any sense of true victory.
[39] The administration of justice requires that schedules have some meaning. People build their lives around schedules and commit time and cost relying on schedules. Reading the proceedings above, one wonders why we bother setting schedules.
[40] Mr. Jia argues that the defendants will suffer no prejudice that cannot be compensated in costs. Yet his clients submit that cost thrown away should be in the cause. Those two submissions oppose each other. I could order costs thrown away. Trial prep costs are not a few hundred dollars. But if I order significant costs thrown away, I can foresee the orgy of appeals and enforcement proceedings to come. A Rule 60.12 motion to dismiss the proceeding is a very likely result. One way or the other, the process will likely be completely deflected from an efficient, affordable, proportionate search for justice on the merits.
[41] Having said that, the efficient and affordable part is probably long gone in any event. The issue really comes down to whether there should be another five month delay with a detour into costs enforcement proceedings or an effort to determine the merits of the case once and for all.
[42] If I knew that the trial would go ahead on a fixed date in the near future, I might conclude that a week or two does not really hurt. But it is five months minimum subject to the vagaries of the court’s trial schedule in 2021. Moreover, I have no reason to believe that the plaintiffs will be ready to go to trial then in any event. They certainly will argue that a few weeks is insufficient time. As I said at the outset, I am not going behind the firing of Mr. Bastien. It may be a totally reasonable and responsible step from the Arcontis’ point of view. But theirs is not the only point of view at issue.
[43] In all, while the reason for the request to adjourn the mini-trial may be understandable, the history, the prejudice of yet further substantial delay, the shear need to enforce a schedule, and the current availability of the parties, the experts, and the court, all weigh heavily in favour of proceeding.
[44] Most significant however, is that the proceeding has been tightly managed into a short, narrow affair, in which existing, fulsome cross-examinations are to be tweaked on narrow, well-defined issues. I find that plaintiffs’ interests will not be significantly compromised if they cannot retain counsel to conduct the cross-examinations on their one witness day. They know the facts and issues very well. They are articulate and fully engaged on the merits. They know why they believe Mr. Smith did not properly fulfill his duties to them and can readily ask the three witnesses about it. Because the trial has been so heavily managed, there is no further paper to be filed. The cross-examinations will necessarily have to be brief to get through three witnesses on their witness day. The plaintiffs are far less affected than an unsophisticated plaintiff who has had no real involvement in proceedings and finds himself without counsel shortly before a full trial on liability, causation, and damages.
[45] Finally, I note that the plaintiffs found a new, limited-scope retainer counsel very quickly to ask for this adjournment. They will have had two weeks from the firing of Mr. Bastien to the commencement of the mini-trial to find a lawyer to conduct three limited cross-examinations with existing transcripts from which to prepare. In my view, the plaintiffs will be able to find counsel if they wish to do so.
[46] In my judgment, weighing all of the factors adopted by the Court of Appeal above and especially considering: the limited harm to the plaintiffs in the particular circumstances of this case, the prejudice of uncompensated delay, the desirability of getting to a decision on the merits rather than creating new issues, and the systemic need for the administration of justice to enforce its scheduling orders to avoid a miscarriage of justice from being perpetrated by persistent delays, the interests of justice require that the mini-trial proceed.
[47] The request to adjourn the mini-trial is dismissed.
F.L. Myers J.
Date: August 21, 2020