Court File and Parties

COURT FILE NO.: CV-13-476840

DATE: 2020-08-26

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: 1875169 ONTARIO LIMITED, Plaintiff

AND:

LUIGI SANTAGUIDA also known as LOUIE SANTAGUIDA, TERRASAN DEVELOPMENT CORPORATION, TERRASAN CORPORATION, PREMIER EQUIPMENT RENTAL SOLUTIONS LTD., 1711095 ONTARIO LIMITED,MARYLOU SANTAGUIDA AND JEFF USHER, Defendants

BEFORE: Schabas J.

COUNSEL: Brett Moldaver, Counsel for the Defendants/Appellants

John Lo Faso, Counsel for the Plaintiff/Respondent

HEARD: August 25, 2020, in writing

Endorsement

[1] This is an appeal from the Order of Master Graham dated November 1, 2018, setting aside the Order of the Registrar dated April 25, 2018 dismissing the Respondent’s action pursuant to Rule 48 as it had not been set down for trial within five years.

[2] The test for setting aside a registrar’s order has been well-settled since being articulated in Reid v. Dow Corning Corp. (2001), 11 C.P.C. (5th) 80 (Ont. S.C.), at para. 41, rev’d on other grounds (2002), 48 C.P.C. (5th) 93 (Ont. Div. Ct.), and was recently restated in the context of the present Rule 48.14 by the Court of Appeal in Prescott v. Barbon, 2018 ONCA 504, at para. 14:

The legal test for setting aside a registrar’s order dismissing an action for delay was originally described by Master Dash in Reid and adopted by this court in Scaini v. Prochnicki, 2007 ONCA 63, 85 O.R. (3d) 179:

(i) Have the plaintiffs provided a satisfactory explanation for the litigation delay?

(ii) Have the plaintiffs led satisfactory evidence to explain that they always intended to prosecute this action within the time limit set out in the rules or a court order but failed to do so through inadvertence?

(iii) Have the plaintiffs demonstrated that they moved forthwith to set aside the dismissal order as soon as the order came to their attention, and

(iv) Have the plaintiffs convinced the court that the defendants have not demonstrated any significant prejudice in presenting their case at trial as a result of the plaintiffs’ delay or as a result of steps taken following the dismissal of the action?

This is not a rigid, one-size fits all test. Rather, a contextual approach is required: Scaini, at paras. 23-25. Prior to Scaini, a plaintiff had to satisfy each of the four elements. Thereafter, courts were to consider and weigh all relevant factors to determine the order that is just. See also Marché d’Alimentation Denis Thériault Ltée. v. Giant Tiger Stores Ltd., 2007 ONCA 695, 87 O.R. (3d) 660. In Hamilton (City) v. Svedas Koyanagi Architects Inc., 2010 ONCA 887, 104 O.R. (3d) 689, at para. 23, Laskin J. A. observed that the overriding objective is to achieve a result that balances the interests of the parties and takes account of the public’s interest in the timely resolution of disputes. The four Reid factors provide a structured approach to achieving this result.

[3] The Court also observed, at para. 11:

The decision of a Master granting or refusing to set aside an administrative dismissal is discretionary. It is entitled to deference and may be set aside only if made on an erroneous legal principle or infected by palpable and overriding error of fact: 1196158 Ontario Inc. v. 6274013 Canada Ltd., 2012 ONCA 544, 112 O.R. (3d) 67; and Chrisjohn v. Riley Estate, 2015 ONCA 713, 341 O.A.C. 70. It is not for an appellate court judge to reweigh the evidence and substitute another discretionary decision for that of the Master. Applying Zeitoun v. Economical Insurance Group (2009), 2009 ONCA 415, 96 O.R. (3d) 639, Cronk J.A. stated in Wellwood v. Ontario Provincial Police, 2010 ONCA 386, 102 O.R. (3d) 555, at para. 28, that it is settled law that an appeal from a Master’s decision is not a rehearing.

Rather, on questions of fact and mixed fact and law, deference applies and the role of the reviewing court is limited. An appellate court cannot substitute its interpretation of the facts or reweigh the evidence simply because it takes a different view of the evidence from that of the master. On questions of law, the correctness standard applies: see Housen v. Nikolaisen, 2002 SCC 33, [2002] 2 S.C.R. 235; H.L. v. Canada (Attorney General), 2005 SCC 25, [2005] 1 S.C.R. 401.

[4] In this case, I see no basis on which to interfere with the Master’s decision setting aside the registrar’s order and reinstating the action. The Master made no errors of law or findings that were unreasonable based on the evidence before him. A Master is entitled to make reasonable inferences which are entitled to “significant deference”: Habib v. Mucaj, 2012 ONCA 8803, at para. 9

[5] The Master considered and weighed each factor in the context of the case before him. He found that the missing of the deadline was due to inadvertence by the plaintiff’s lawyer. Indeed, the lawyer was examined on this issue and the Master noted that “there was no evidence on his examination that would lead the Court to conclude that the passage of time leading up to the dismissal was deliberate.” This is not “speculation” as argued by the appellant, but a reasonable inference that “on the totality of the evidence, there was nothing to suggest that the missing of the deadline was deliberate.” Accordingly, there was evidence on which the Master could reasonably find that the second part of the test was met and that finding is entitled to deference.

[6] There was no question that the motion was brought promptly following the dismissal, as the Master found.

[7] Respecting prejudice, described as a “key consideration” in Prescott (at para. 33), the Master noted that there is “a presumption of prejudice that the plaintiff must overcome.” This reflects the importance of timely resolution of disputes and that memories fade over time. However, the deponent for the plaintiff stated that “all relevant documents are still available and no witnesses have died or become unavailable.” No evidence to the contrary was put forward by the defendants. I see no error in the Master’s statement, in this context, that “if there were witnesses on whom the defendants wanted to rely who were not available, they would be the ones to be aware of that, and there is some onus on the defendants to show actual prejudice by indicating specifically which witnesses are not available.” This did not improperly reverse the onus, but simply reflected the lack of any evidence from the defendants contradicting the plaintiff once it had met its onus.

[8] The Master did not explicitly consider the principle of finality and weigh it against the plaintiff’s interest; however, his reasons refer to the fact that “the action was clearly not abandoned, and the defendants would have had no reason to think that the action was abandoned given that the certificate of pending litigation (“CPL”) continued to be in place on the subject properties.” While the defendants’ evidence was that the properties have been sold, they did not say when, advising the Court on this appeal that the sales occurred in 2017. Consequently, during the period of the unexplained delay, there appears to have in fact been some action regarding the matter. In the absence of evidence that this would have brought some sense of “finality” to the defendants, the continuation of the CPLs to at least some time in 2017 supports the Master’s conclusion on this issue.

[9] Further, as the Court of Appeal observed in Labelle v. Canada (Border Services Agency), 2016 ONCA 187, at para. 38, this case “is not an instance where finality must trump the preference of having the action heard on its merits.” As in Labelle, the defendants have suffered no prejudice from the delay and did not rely on the finality of the dismissal order. Although the plaintiff has the responsibility of moving the action along, the defendants’ “lack of display of any sense of urgency undercuts the claim of prejudice.”

[10] Thus, although there was no “satisfactory explanation” for the delay, the test effectively accepts that inadvertence may be a satisfactory explanation when the plaintiff satisfies the rest of the factors. As stated, all factors do not need to be met, but they must, as the Master said, be considered on a “contextual basis”. This is well-supported by the Court of Appeal’s decision in Habib, at para. 6. Here, the Master considered a number of contextual factors that informed his conclusion. This included that the period of unexplained delay was 22 months which, although not to be minimized, is a shorter period of time than one often sees on these motions and in the jurisprudence. The Master also considered the absence of evidence of actual prejudice, that the defendant did nothing to move the matter along, and that the focus must be on the rights of the parties and not on the conduct of counsel.

[11] These are all appropriate considerations. While the defendant takes issue with the Master’s comment that the defendants also “have some onus to move the action as well and cannot simply sit back and do nothing at all,” this is supported by the Court of Appeal’s statement in Hamilton (City) v. Svedas Koyanagi Architects Inc., 2010 ONCA 887, at para. 27, that “defendants as well as plaintiffs have an obligation to move an action along.” Although more recently, in Prescott Pepall J.A. stated, at para. 30, that “[t]here is no burden on the defendant to explain the delay or move the action to trial”, she also echoed Laskin J.A. in Hamilton that the “primary responsibility for the progress of an action lies with the plaintiff.” [emphasis added]. In my view the Master did not reverse the onus but simply considered as part of the context that the defendant had taken no steps to advance the action during those 22 months.

[12] The Master also properly noted, based on Habib at para. 7, that “the focus should be on the rights of the parties rather than the conduct of counsel.” As the Court of Appeal has pointed out, Rule 1.04(1) reflects the importance of construing the Rules of Civil Procedure to ensure that cases are decided on their merits. This means, as Laskin J.A. confirmed in Hamilton, at para. 20, that “the court's bias is in favour of deciding matters on their merits rather than terminating rights on procedural grounds". Similarly, in Marché d’Alimentation Denis Thériault Ltée, Sharpe J.A. stated at para. 34: “Where, despite the delay, the defendant would not be unfairly prejudiced should the matter proceed for resolution on the merits, according the plaintiff an indulgence is generally favoured.”

[13] In conclusion, I do not accept that the Master made any errors of law or palpable and overriding errors of fact or of mixed fact and law and there is no basis to interfere with his decision. The appeal is dismissed.

[14] As to costs, the respondent may provide me with written submissions not exceeding 2 pages, not including supporting documents, within 14 days of release of these Reasons, and the appellant may provide submissions with the same restrictions 7 days later.

Schabas J.

Date: 2020-08-26