COURT FILE NO.: CV-13-494353
DATE: 20200826
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: GEORGIA TSITSOS, HARALBOS TSITSOS AND STEVEN TSITSOS, Plaintiffs (Defendants by Counterclaim)
AND:
KAOULI POKA, Defendant (Plaintiff by Counterclaim)
BEFORE: KIMMEL J.
COUNSEL: Alex van Kralingen and Katherine Chau, for the Plaintiffs and Defendants by Counterclaim
Andrea Habas, for the Defendant (Plaintiff by Counterclaim)
HEARD: August 11, 2020
ENDORSEMENT
[1] This is a 2013 action arising from a dispute between two sisters, Georgia Tsitsos and Kaouli Poka. Ms. Tsitsos is seeking various relief relating to a property located at 41 Hill Crescent, Toronto, Ontario and relating to certain items of personal property located in the house. Ms. Poka claims in her counterclaim an ownership interest in two businesses, Santa Maria Pizza and Spaghetti House Ltd. & 3314910 Manitoba Inc. (collectively, the “Manitoba businesses”).
[2] The parties, through their lawyers, agreed to proceed by way of a summary trial in April 2019. A schedule for pre-trial steps, including discoveries and the pre-filing of certain evidence, was agreed to in June 2019 for a trial that was initially scheduled to proceed in December 2019. The trial has been adjourned twice since June 2019 (first from December 2019 to March 2020 and then from March 2020 to September 2020), both times at the request of Ms. Poka and both times the adjournments were made peremptory to her.
[3] This motion by the defendant seeks to extend or vary certain trial procedures that were agreed to and endorsed by the court[^1] as part of the trial management process at three pre-trial conferences held in this matter between November 2019 and February 2020. The defendant also seeks leave of the court to withdraw deemed admissions arising from an unanswered request to admit that was delivered by the plaintiffs in accordance with the Trial Procedure Agreement, and also now seeks additional documentary production (discovery) from the plaintiffs primarily relating to the counterclaim involving the Manitoba businesses.
[4] At the last pre-trial conference (which I presided over), an adjournment of the trial was granted in part to allow for this motion to be brought by newly appointed counsel for the defendant. The motion was scheduled to be heard in May 2020 in advance of the twice adjourned September 21, 2020 trial date. Unfortunately, this motion was scheduled to proceed during the temporary suspension of regular court operations due to the COVID-19 pandemic. It was re-booked when the court began scheduling remote, long motions and came before me on an urgent basis given the impending trial date.
[5] The defendant was put on notice when the last adjournment of the trial was granted that the plaintiffs, in addition to opposing the defendant’s requests, would be seeking in the alternative and as a term of any order on this motion, their costs thrown away in the range of $50,000.00.
[6] The trial is scheduled for ten days commencing on September 21, 2020. No one is asking for it to be adjourned, nor would I be inclined to adjourn it given the procedural history of this matter. At the outset of the hearing of this motion, I asked counsel for the parties if there was any concern with me presiding over this motion given that I had presided over two of the pre-trial conferences, including the last one that adjourned the trial a second time to allow for this motion to be brought. No objections were raised and counsel for both sides confirmed their consent for me to hear and decide this motion.
The Issues to be Decided on this Motion
[7] The following issues arise on this motion:
a. Should the defendant be permitted to deliver material outside of the time frames contemplated by the Trial Procedure Agreement:
i. To replace or supplement the trial affidavits that were filed on her behalf by her previous lawyer pursuant to the Trial Procedure Agreement?
ii. To file notices that were not filed on her behalf regarding objections to the plaintiffs’ affidavits, the intention to cross-examine on the plaintiffs’ affidavits and the need for an interpreter?
iii. To prepare and serve, at her own expense, a new joint document book to replace the one that was prepared by the plaintiffs in accordance with the Trial Procedure Agreement?
b. Should the defendant be permitted to withdraw admissions she is deemed to have made as a result of her failure to respond to the plaintiffs’ Request to Admit delivered in accordance with the Trial Procedure Agreement?
c. Is the defendant entitled to request further documentary production from the plaintiffs and, if so, should leave be granted for her to do so and should the requested documents be ordered produced by the plaintiffs before trial?
d. Are the plaintiffs’ entitled to costs thrown away as a condition of any orders granted under this motion?
e. Should there be any costs of this motion, and, if so, on what scale and in what amount?
f. What other directions and orders are appropriate to ensure that the parties are ready to proceed to trial on September 21, 2020?
Analysis
The Defendant’s Position
[8] The defendant relies generally upon the court’s inherent jurisdiction to regulate and control its proceedings, and seeks an indulgence, in the interests of fairness of the trial process, to allow for the just determination of the case on its merits. See Abrams v. Abrams, 2010 ONSC 2703, 102 O.R. (3d) 645. The Court of Appeal has endorsed, in the context of considering whether to dismiss an action for delay, an approach favouring the determination of a matter on its merits rather than on procedural grounds that can be applied in other procedural contexts such as this:
[26] [T]he Court’s bias is in favour of deciding matters on their merits rather than terminating rights on procedural grounds.” While failure to enforce the rules may undermine public confidence in the capacity of the justice system to process disputes fairly and efficiently, as Sharpe J.A. observed in Marché [Marché d’Alimentation Denis Thériault Ltée v. Giant Tiger Stores Ltd., 2007 ONCA 695, 286 D.L.R. (4th) 487], at para. 19, nonetheless:
‘[P]rocedural rules are the servants of justice not its master ... We should strive to avoid a purely formalistic and mechanical application of time lines that would penalize parties for technical non-compliance and frustrate the fundamental goal of resolving disputes on their merits. [T]he Rules and procedural orders are construed in a way that advances the interests of justice, and ordinarily permits the parties to get to the real merits of their dispute.’
[27] The Court’s preference for deciding matters on their merits is all the more pronounced where delay results from an error committed by counsel. ... In Marché, Sharpe J.A. stated at para. 28, “The law will not ordinarily allow an innocent client to suffer the irrevocable loss of the right to proceed by reason of the inadvertence of his or her solicitor.” [citations omitted]
See H.B. Fuller Company v. Rogers (Rogers Law Office), 2015 ONCA 173, 386 DLR (4th) 262, at para. 26-27.
[9] The Defendant places much of the fault for the deficiencies in her trial briefing on her previous counsel, who is said to have dropped the ball not only in the fall of 2019 after a car accident and other mishaps, but to have failed to adequately represent the defendant throughout the implementation of the Trial Procedure Agreement. While acknowledged to have arisen in different context, the defendant urges “the court [to] be concerned primarily with the rights of the litigants, not with the conduct of their counsel” as the Ontario Court of Appeal was in Habib v. Mucaj, 2012 ONCA 880, at para. 7.
[10] It is conceded by the defendant that certain terms in favour of the plaintiffs would be appropriate if the relief requested is granted, including that the plaintiffs be afforded the opportunity to respond to any new filings of the defendant and to be awarded some costs thrown away (although the amount of which is disputed).
The Plaintiffs’ Position
[11] The plaintiffs oppose this motion generally on the grounds that it is a request by the defendant to “re-do” her trial evidence after receiving the plaintiffs’ evidence (including its reply affidavits), based on apparent deficiencies. This is a luxury that parties are not afforded at trial, in the normal course, when evidence goes in viva voce. The plaintiffs’ distrust the defendant’s explanations suggest that the conduct of her previous counsel was intentional and not due to negligence, and that the defendant should not be permitted to adopt a new trial strategy at this late time. The plaintiffs also maintain that the defendant has failed to meet the requirements of the applicable tests for some of the relief being sought. The plaintiffs seek significant costs thrown away and other ancillary relief if the motion is granted.
[12] The plaintiffs point out that the court’s inherent jurisdiction, “…to do justice between the parties and secure a fair trial between them,” is to be exercised sparingly. See I.H. Jacob, “The Inherent Jurisdiction of the Court” (1970) 23:1 Current Leg. Probs. 23, at 51 cited with approval by the Supreme Court of Canada in R. v. Caron, 2011 SCC 5, [2011] 1 SCR 78, at para. 24; and Ontario v. Criminal Lawyers’ Association, 2013 SCC 43, [2013] 3 SCR 3, at para. 20.
A. The Trial Procedure Agreement – Missed Deadlines and Consequences
[13] Although the courts, generally, will only amend or revise agreements reached between the parties based on contractual principles, where a timetable is established by agreement that provides no consequences for any default, the court may still exercise its discretion to extend the time in favour of the defaulting party. See Royal Bank of Canada v. Feldman, 1993 CanLII 5464 (ON SC), 15 O.R. (3d) 501, (S.C.). Of primary concern in these circumstances is whether the requested adjustments to the timetable will result in irremediable prejudice to the non-defaulting party.
i) Trial Affidavits
[14] In accordance with the Trial Procedure Agreement, the following materials were delivered on behalf of the defendant by her former counsel, on or before July 22, 2019. These were intended to represent the in-chief evidence of witnesses to be called by her:
a. affidavit of Ms. Poka affirmed July 10, 2019;
b. the affidavit of Laura Bulley sworn April 22, 2017;
c. the affidavit of Ioannis Papasotiriou sworn July 7, 2015;
d. the affidavit of Wasiem Diab affirmed July 11, 2019;
e. the affidavit of Demitry Papasotiriou-Langeigne affirmed July 12, 2019;
f. the unsworn affidavit of Lina Poka; and
g. five willsay statements.
[15] At least up until February 2020 when the trial was last adjourned, the plaintiffs had been preparing for the trial (scheduled to commence in March 2020) on the basis of the evidence that had been tendered on behalf of the defendant.
[16] Ms. Poka is asking to withdraw and replace, amend or supplement three of those affidavits (her own, and those of Diab and Papasotiriou-Langeigne). She also seeks leave to provide affidavits in substantially the same form as the unsworn Lina Poka affidavit and the five willsay statements and has represented to the court that they are each prepared to swear affidavits in the form of their prior willsay statements or in Lina Poka’s case, her unsworn affidavit. In the material filed in support of this motion (although not in the original notice of motion), the defendant also seeks leave to file an additional affidavit from her Greek lawyer, Konstantinos Evaggelos Mineopoulos, in respect of her retainer of him to obtain the Greek bank records evidencing the deposit and withdrawal of 24,000,000 Drachma that she claims represents her investment in the Manitoba businesses.
[17] The proposed new, supplementary or revised affidavits were provided and/or described to the defendants in March, 2020 when this motion was originally being briefed for hearing in May, 2020.[^2] These affidavits shall be collectively referred to as the “New and Improved Defence Affidavits”.
[18] The defendant argues that the New and Improved Defence Affidavits mostly:
a. Attempt to address objections raised by the defendant;
b. Put into the trial record facts that had been the subject of previously filed affidavits on earlier motions, not “new” facts or facts that would take the plaintiffs by surprise, with the exception of the evidence about transactions in Ms. Poka’s bank account in Greece in 1992 when she says she advanced funds for use in the plaintiffs’ Manitoba businesses.
c. Provide corroboration for statements already contained in the affidavits.
d. Address evidentiary deficiencies, particularly with respect to the counterclaim. In this regard, the defendant observes that there are glaring omissions from the defence affidavits, particularly in relation to the counterclaim, that could not reasonably be inferred to have been by design or intentional.
[19] The defendant blames her former counsel for being unable or unwilling to properly represent her, not just as a result of a car accident and broken leg in the summer and fall of 2019 which were the stated reasons for the initial adjournment requests, but even before that when the trial affidavits and productions were being prepared and exchanged between April and July 2019.
[20] The plaintiffs urge the court not to accept the suggestion that Ms. Poka’s prior counsel was negligent in the preparation of the trial affidavits and productions. The evidence of the defendant’s former lawyer who was cross-examined on this motion describes a detailed process by which information was gathered and drafted into affidavits that were reviewed and discussed with the deponents, whose input and changes were implemented. There is no evidence of any strain in the relationship between Ms. Poka and her counsel during the period in which these affidavits were being prepared or until the end of 2019.
[21] The plaintiffs point out that there is no evidence of medical issues interfering with defence counsel’s ability to work in May, June and July 2019, when these trial affidavits were being drafted. To the contrary, she was meeting her deadlines. The plaintiffs argue that the court should infer that the omissions in those affidavits that the New and Improved Defence Affidavits seek to address were by design and intentional.
[22] The plaintiffs also argue that even the defendant’s excuses tied to the injuries sustained by her former lawyer in a car accident, which was said to have impacted the lawyer’s ability to properly represent the defendant’s interests between July and December 2019, have not been corroborated by independent medical evidence. Some evidence came to light in the context of this motion indicating that defence counsel’s injuries were used as an excuse for delaying the trial while the defendant was looking for further productions from her Greek bank, which she has now found and seeks to introduce through the new and amended affidavits.
[23] The plaintiffs urge me not to accept the various explanations provided by the defendant for her need to re-do her trial affidavits and make further productions, on various grounds. Not surprisingly, the former lawyer for the defendant, Ms. Osadet, is defensive of her prior work having been consistent with her instructions. This is not the time or the place for the court to make findings regarding Ms. Osadet’s conduct and whether it was negligent and consistent with her instructions. What is clear is that the defendant has now identified deficiencies in the materials previously prepared and she wants the opportunity to fix them through the New and Improved Defence Affidavits.
[24] What is also clear is that none of this is the plaintiffs’ fault and, whatever the explanation and cause of the deficiencies may be, the plaintiffs should not be prejudiced. At this stage, a further adjournment of the trial would presumptively prejudice the plaintiffs, and that is not on the table. My evaluation of the potential prejudice to the plaintiffs is based on what would have to take place so that the case can proceed to trial as scheduled on September 21, 2020.
[25] The plaintiffs have also noted concerns with the form and admissibility of certain of the New and Improved Defence Affidavits that go beyond the trial objection process and should be dealt with at the leave stage. Specifically, the plaintiffs argue that paragraph 15 and certain exhibits (including E, F and G) to Ms. Poka’s supplementary affidavit, which append previously filed affidavits on motions that contain hearsay, would be inadmissible at trial. I understand that there are five such objectionable exhibits in total. Further concerns have been noted about the relevance of some of the evidence, including the new evidence and documents about the deposit into and withdrawal from Ms. Poka’s Greek bank account. This is because the fact of that deposit and withdrawal, even if proven, does not prove who the funds were given to. The defendant argues that, even if some of the evidence is ultimately not in proper form, it can go in for context and the trial judge can decide what to do with it.
[26] I am skeptical about some of the explanations that have been provided by Ms. Poka. I am concerned that much of her explanations come from her cross-examination after her former lawyer had been examined, and were not provided up front to support the indulgences that she is asking the court for on this motion. I am not, however, prepared to make any findings about the adequacy of her former lawyer’s representation, one way or the other, based on the record before me.
[27] That said, the court’s preference for a fair adjudication and just determination of the claim and counterclaim on their merits leads me to reluctantly grant leave to the defendant to withdraw and replace, amend and supplement her trial affidavits, in the manner she proposes, by delivering the New and Improved Defence Affidavits, with the exception of the inclusion of certain Exhibits to Ms. Poka’s affidavit which are simply improper because they append previously sworn affidavits. If there is something in those previously filed affidavits that Ms. Poka has direct knowledge of that she wishes to say in her trial affidavit, she can do so but she cannot simply append prior affidavits as exhibits to her trial affidavit. All other issues of admissibility, relevance and weight of the New and Improved Defence Affidavits can be determined by the trial judge.
[28] The issue of costs that the plaintiffs are entitled to as a result of leave being granted to the defendant to file the New and Improved Defence Affidavits will be addressed later in these reasons. However, the trial process must also be fair to the plaintiffs and there are some other terms that I am imposing as a condition of the leave being granted, as follows:
a. The New and Improved Defence Affidavits, in their final form (sworn or affirmed), are to be delivered within seven days of the release of these reasons.
b. The plaintiffs shall have a right to deliver reply affidavits, if so advised, to these New and Improved Defence Affidavits (the defendant concedes that plaintiffs have the right to do this). The plaintiffs’ reply affidavits, if any, are to be delivered within ten days of receipt of the New and Improved Defence Affidavits in their final form.
c. There will be no right of cross-examination or discovery arising from the exchange of these further trial affidavits (by either side), except cross-examination at trial within the time limits available for each side for completion of the trial within the time allotted for it.
d. The defendant’s affiants may be cross-examined at trial in the normal course, and subject to the discretion of the trial judge, on changes in their evidence reflected in the New and Improved Defence Affidavits.
e. The plaintiffs shall have the right to file supplementary Notices of Objection to the New and Improved Defence Affidavits and to have those objections determined at the outset of trial, together with any remaining objections detailed in previously delivered Notices of Objection.[^3] Those updated Notices of Objection are to be delivered at the same time that the plaintiffs’ reply affidavits are due. The deadline under the Trial Procedure Agreement for compiling the Notices of Objection for submission to the trial judge is amended, if necessary, to allow for the inclusion of these further objections by the plaintiffs to the New and Improved Defence Affidavits.
ii) Trial Notices
[29] Initially, the defendant’s motion sought leave to file (i) Notices of Objection in respect of the plaintiffs’ trial affidavits, (ii) Notices of Intention to Cross-Examine on the plaintiffs’ affidavits and (iii) a Notice of Interpreter. It turned out that the Notices of Intention to Cross-Examine had been delivered by defendant’s former counsel. The plaintiffs do not oppose the use of an interpreter by the defendant, even though the notice for such is late according to the Trial Procedure Agreement.
[30] That leaves for my determination the question of whether leave should be granted to the defendant to deliver Notices of Objection to the plaintiffs’ trial affidavits. The defendant once again blames her former counsel for neglecting to deliver these Notices of Objection. The plaintiffs argue that the evidence on this motion does not support the granting of an indulgence without satisfactory explanation for the failure to deliver the notices, and the trial should proceed without the defendant being permitted, at this late point, to object to the plaintiffs’ trial affidavits. The plaintiffs say that the defendant has not demonstrated on the record that the late filings are necessary to ensure justice and fairness to the trial process.
[31] In the normal course, it is for the trial judge to determine questions of admissibility, relevance and weight of the trial evidence, and those determinations can be made irrespective of whether or not the opposing party raises an objection. The process for objections in advance of trial under the Trial Procedure Agreement in this case was intended to assist the trial judge. She or he should not be deprived of that assistance just because the defendant failed to comply with the timeline for delivery of those objections. It is in the interests of trial efficiency for the defendant to be permitted to deliver her objections to the plaintiffs’ trial affidavits in advance of trial. Those objections are to be delivered by no later than the date for delivery of the New and Improved Defence Affidavits.
[32] Costs thrown away of the plaintiffs for their preparation for trial on the assumption that there were no objections to their affidavits as a term of granting this relief and extension in the time for objection under the Trial Procedure Agreement are addressed later in these reasons.
iii) Updates to the Joint Document Book (“JDB”)
[33] The defendant’s former counsel did not co-operate or participate in formation of the JDB. The defendant wishes to include additional documents in the JDB at her own expense. A JDB is an aid for the trial judge and trial witnesses and contributes to the efficient conduct of the trial. While the defendant should not be rewarded for failing to participate in the production of the JDB as was contemplated by the Trial Procedure Agreement, to the extent that there are documents that the defendant intends to tender as exhibits at trial or put to witnesses in cross-examination, they should be in the JDB.
[34] The defendant is granted leave to add documents to the existing JDB and update the index and prepare the requisite number of copies of the JDB at her own expense. This is to be completed by one week prior to the commencement of the trial. The documents to be included must either be exhibits to the New and Improved Defence Affidavits or documents already produced by a party. This is not a licence for the production of new documents by the defendant. Before compiling the new JDB, the defendant shall share with counsel for the plaintiffs a copy of an updated index that identifies the new documents proposed for inclusion and the tabs at which they will be added and is to work co-operatively with plaintiffs’ counsel to create a user-friendly JDB for the trial judge.
[35] The inclusion of a document in the JDB is not an admission of its authenticity. Any issues of authenticity of documents included in the JDB should be identified for the trial judge in the index to the JDB and/or at the outset of the trial.
B. Withdrawal of Deemed Admissions
[36] The Trial Procedure Agreement set deadlines for delivery of Requests to Admit and responses. At the October 2019 pre-trial conference, the defendant was granted an extension in the time for her response to the Request to Admit delivered by the plaintiffs in accordance with the timelines provided under the Trial Procedure Agreement. Notwithstanding that prior indulgence, the defendant did not respond to the plaintiffs’ Request to Admit by the new deadline. As a result of that failure, and by virtue of Rule 51.03, the defendant was deemed to admit the facts set forth in the plaintiffs’ Request to Admit and the authenticity of any listed documents.
[37] There are specific requirements that the defendant must meet in order to be granted leave to withdraw admissions. The defendant’s submissions on this motion do not expressly address this test for withdrawal of admissions.
[38] The plaintiffs set out the test that the defendant must meet, which can be found in Antipas et al v. Coroneos et al, 1988 CanLII 10348 (ON SC), [1988] O.J. No. 137 (Ont. H.C.) (applied by the Court of Appeal for Ontario in 147619 Canada Inc. v. Chartrand, [2006] O.J. No. 1877 (Ont. C.A.)):
a. The proposed changes must raise a triable issue;
b. The admission must have been inadvertent or resulted from wrong instructions;
c. It must be demonstrated that the withdrawal of the admission will not result in any prejudice to the other side that cannot be compensated for in costs.
[39] The plaintiffs concede that the admissions, if withdrawn, give rise to triable issues on the points that the admissions relate to. The plaintiffs acknowledge that the deemed admissions support important aspects of the plaintiffs’ claims (and undermine aspects of the counterclaim). However, they say that second and third prongs of the test for withdrawal have not been met.
[40] Particular emphasis is placed on the second requirement that the defendant demonstrate that the admissions were inadvertent or resulted from wrong instructions. The defendant says she was unaware of the implications of not responding to the Request to Admit and that she did not instruct her former lawyer one way or the other about this. The defendant also maintains that some of the deemed admissions go to matters that she had addressed in previously filed affidavits on motions in the proceeding and that the plaintiffs were aware of her position on these points, despite having not responded to the plaintiffs’ Request to Admit.
[41] While I have expressed skepticism about the defendant’s explanations for certain lapses in the adherence to the Trial Procedure Agreement, I am satisfied that the failure to respond to the plaintiffs’ Request to Admit was not the result of an instruction from the defendant and that the defendant was not aware of the consequence of not responding, so I accept that the defendant’s deemed admissions were inadvertent in that sense.
[42] The court’s preference…
… for deciding matters on their merits is all the more pronounced where delay results from an error committed by counsel. …In Marché, Sharpe J.A. stated at para. 28, “The law will not ordinarily allow an innocent client to suffer the irrevocable loss of the right to proceed by reason of the inadvertence of his or her solicitor.” [citations omitted]
See H.B. Fuller, at paras. 26-27.
[43] On the third branch of the test, while the plaintiffs did for a time prepare for trial on the basis of the deemed admissions, they have known since March 2020, when this motion was brought, that the defendant was seeking to withdraw them. The plaintiffs have prepared an estimate of their costs thrown away which includes costs for having prepared for a trial that might have proceeded based on these deemed admissions before leave was sought to withdraw them. I am not aware of any other prejudice to the plaintiffs (aside from the loss of the deemed admissions themselves requiring those facts to be proven at trial). The cost prejudice is addressed later in these reasons.
[44] The defendant is granted leave to withdraw her deemed admissions arising from the plaintiffs’ Request to Admit which will be withdrawn upon the defendant’s delivery of a response to the plaintiffs’ Request previously delivered within seven days of this decision. Any deemed admissions not addressed by a response to Request to Admit from the defendant within this time frame will continue to be deemed admissions that the plaintiffs may rely upon at trial.
C. Further Documentary Discovery Requested from the Plaintiffs
[45] The defendant seeks production of two months of personal and corporate bank statements (for May and June of 1992) and twenty-seven years of financial statements relating to the Manitoba businesses. An agreed upon amendment to the Trial Procedure Agreement, arising out of the October 28, 2019 pre-trial conference, required the defendant to bring her then contemplated motion for disclosure of business records from the plaintiffs by November 22, 2019. No such motion was brought, nor was any extension in the time prescribed for bringing it requested thereafter. The original Trial Procedure Agreement had required the completion of all documentary and oral discovery by August 30, 2019. No request was made for the now requested business records from the plaintiffs as part of the written interrogatories that ensued.
[46] Rule 48 precludes any motion for discovery without leave after the defendant consented to this action and counterclaim being set down for trial. The defendant also needs leave to make this request under Rule 37.06 because these production requests are not part of the stated relief sought in the defendant’s notice of this motion. In the absence of any formal request for leave of the court under Rule 77.06, the plaintiffs argue that the court should not entertain this request at all.
[47] The plaintiffs also argue that, even if the court were to consider granting leave for this production request, the defendant has not met the test. Master Short said in J.A.L. Developments v. Residences of Springhill Inc., 2020 ONSC 2222, at paras. 59-68, that the moving party must demonstrate some justification for being permitted to take back the certification of trial readiness under Rule 48. The court is to take a flexible approach and conider whether “…the interlocutory step is necessary in the interest of justice”.
[48] The defendant has not addressed this test-she only addresses the potential relevance of the documents requested. The defendant testified that she does not know whether her former counsel sought these records, and if not why not. The only evidence showing that the defendant asked her former counsel to pursue these records was given during her cross-examination, not in her affidavit in support of this motion, and only after the examinations of other witnesses, such as her former lawyer, had been completed. It was only then that the defendant stated for the first time that she had asked her lawyer to get these records. Even if the defendant was “surprised” that her lawyer never asked for the documents that she now seeks from the plaintiffs in support of her counterclaim, I am not satisfied that this is a substantial and unexpected change in circumstances.
[49] The bank records from May and June of 1992 that the defendant now seeks from the plaintiffs could be said to tie into some of the new evidence from the defendant about the deposit into and withdrawal from her Greek bank account (as she now seeks to trace those funds or equivalents into the plaintiffs’ accounts associated with the Manitoba businesses). These bank records may also be relevant to the evidence of one of the plaintiffs’ witnesses, to whom the defendant says she gave these funds. While the defendant may herself be responsible for the late disclosure of her Greek banking records, I am prepared, having considered all of the circumstances, to grant some latitude on this point and I am going to order that the plaintiffs produce the requested banking records, but only if those records can be obtained from the bank, using reasonable diligence, before the commencement of the trial. The late request by the defendant for these records is not grounds to adjourn the trial. If they cannot be obtained in time for the trial then they need not be produced.
[50] The defendant’s late request for production by the plaintiffs’ extensive financial statements (over a twenty-seven-year period) is not granted. In addition to being well out of time, this request would be cumbersome and distracting for the plaintiffs to deal with on what is now, for the second time, the eve of trial. I am not satisfied that these records are required for trial given that one aspect of relief sought by way of counterclaim is production of the plaintiffs’ financial books and records and an accounting, if the defendant’s ownership interest is established. If that relief is granted, then the defendant may renew her request for these records and their relevance can be determined in that context, if disputed by the plaintiffs.
[51] It is not in the interests of justice to order these extensive records to be produced by the plaintiffs at this time. I am not granting leave to the defendant to make this request, nor would these records be ordered produced even if leave was granted.
D. The Plaintiffs’ Costs Thrown Away
[52] The defendant concedes that the plaintiffs are entitled to their costs thrown away associated with the indulgences that she seeks by this motion, but she disputes the amount that the plaintiffs claim for these costs. The defendant was aware from the endorsement at the last pre-trial conference, at which this trial was adjourned to permit the defendant to bring this motion, that the plaintiffs would be seeking significant costs thrown away, in excess of $50,000.00. This was noted in that pre-trial endorsement.
[53] The plaintiffs seek their costs thrown away on a full indemnity basis in the total amount of $53,195.17, inclusive of disbursements of $3,879.14 for the cost of producing the JDB that the defendant will now be replacing. These same costs on a substantial indemnity basis would be $48,263.57.
[54] The plaintiffs’ costs thrown away have been calculated based on a percentage of the actual time spent on aspects of the trial preparation that the plaintiffs will now have to re-do in order to prepare for the trial based on the late indulgences granted to the defendant to file the New and Improved Defence Affidavits, Notices of Objection to the plaintiffs’ affidavits, a new JDB, and to withdraw admissions and seek some limited further production.
[55] The costs requested are within range of what was anticipated when the trial was adjourned to permit this motion in February 2020. The defendant challenges some of the items such as the attendances at pre-trial conferences, but the plaintiffs counter that at least the latter two of the three two pre-trial conferences are tied to the defendant’s late breaking requests and they are not claiming the costs of all three, but a percentage to reflect the time spent addressing the defendant’s repeated lapses in adhering to the Trial Procedure Agreement. The defendant also questioned why there were costs thrown away for the plaintiffs’ memorandum of fact and law, but plaintiffs’ counsel explained that it was a work in progress that was being developed based on the evidentiary record that was expected, including for example the deemed admissions, and part of it will have to be re-done, hence a claim for part of the time spent.
[56] The fees indicated in the plaintiffs’ bill of costs are not unreasonable. The discounts that the plaintiffs have applied in recognition that not all costs will have been thrown away for these items of work leading up to the last trial date are reasonable. There is no reason to look behind the plaintiffs’ bill of costs and they are entitled to full indemnification of costs thrown away as a condition of the relief I have granted in favour of the defendant on this motion. I am fixing the plaintiffs’ full indemnity costs thrown away in the amount of $50,000.00. I am discounting the disbursements for the JDB since I assume that the existing JDB will be used and simply updated by the defendant at the defendant’s cost, as I have previously ordered. This is not an exact dollar for dollar deduction, but it is close enough.
[57] The defendant is ordered to pay this $50,000.00 in costs thrown away to the plaintiffs by September 11, 2020, which is ten days before the set date for the trial to commence. That payment is a condition of all of the relief that I have granted in favour of the defendant on this motion. If the defendant fails to do so, the plaintiffs will be at liberty to pursue all remedies available to them for default either prior to or at the outset of the trial.
E. Costs of this Motion
[58] The plaintiffs also seek their costs of this motion. The plaintiffs request substantial indemnity costs of the motion of $34,625.46 or alternatively partial indemnity costs of the motion of $26,481.91. Since the motion was booked for a full day and only took half a day, the plaintiffs agree that these numbers should be subject to a small discount for the extra half day counsel fee that was included.
[59] The defendant argues that there should be no costs. The defendant is not seeking costs of this motion, even if she is granted much of the relief she sought, but she maintains that she should not have to pay costs given the plaintiffs’ opposition. The defendant did concede that if some of what she was asking for is not granted then the plaintiffs would be entitled to some costs, but not what they are asking for. Defendant’s counsel submitted that a more appropriate range of partial indemnity costs for a motion such as this would be $10,000-12,000.00.
[60] The plaintiffs say their opposition to this motion was necessitated by the structure of motion, that the defendant did not seek leave for certain things and because of the general requests were overly broad and failed to address the tests that had to be met for the relief sought. They noted that much of what the defendant ultimately based her submissions on was evidence that came out for the first time on cross-examination. The plaintiffs also note that much of the procedural history had to be provided by them because of the defendant’s inability to get her former lawyer’s file, which put the plaintiffs to additional expense.
[61] Costs of motions such as this are discretionary. In the exercise of my discretion under Rule 57 and s. 131 of the Courts of Justice Act, R.S.O. 1990, c. C.43, and having regard to the principles of indemnity and proportionality and the fact that the “success” on this motion cannot be measured entirely by the relief the defendant ultimately was successful in obtaining, I agree with the plaintiffs that they are entitled to their partial indemnity costs of this motion, which I fix in the amount of $20,000.00 and order the defendant to pay within 30 days of these reasons.
[62] I recognize that the costs awards (of the plaintiffs’ costs thrown away and of this motion) place a significant financial burden on the defendant. However, these costs awards are intended to address the significant financial burden that the plaintiffs have been put to as a result of the defendant’s failure to adhere to the Trial Procedure Agreement and her multiple requests to adjourn the trial. The plaintiffs are innocent victims of these procedural delays and costs, irrespective of the ultimate outcome of the trial of the action and counterclaim. If the defendant was a victim of poor representation by her former counsel, as she alleges, that is not something that the plaintiffs should be out-of-pocket for.
F. Trial Management Directions
[63] At the conclusion of the hearing of this motion Ms. Habas, the new counsel for the defendant, advised the court that there was an issue with her retainer and that she may not be appearing as trial counsel. She advised that Ms. Poka may be self-represented at trial if the issue is not worked out. Ms. Habas undertook to the court that she would work co-operatively with plaintiffs’ counsel to implement the orders and directions arising from this motion, irrespective of whether her retainer by the defendant will remain in place for the trial.
[64] Arising from this motion, the defendant is directed to:
a. Deliver her New and Improved Defence Affidavits and Response to Request to Admit within seven days of this decision;
b. Deliver her Notice of Objections to the plaintiffs’ trial affidavits within seven days of this decision;
c. Prepare a revised index to the JDB that incorporates the additional proposed documents for inclusion and work co-operatively with plaintiffs’ counsel to agree upon the further inclusions and then compile, at the defendant’s cost, a new JDB with the requisite number of copies for use at trial to be filed with the trial office for delivery to the trial judge at least one week prior to the scheduled commencement of the trial.
[65] In addition to the orders and directions arising from my rulings herein, there are some further trial management issues that need to be addressed in advance of the fast-approaching trial date, such as:
a. Each side shall prepare an evidence brief containing all of the trial affidavits that they have delivered to each other, to be filed with the trial office for delivery to the trial judge within two days after the plaintiffs’ affidavits in reply to the New and Improved Defence Affidavits, if any, are delivered (or if none are delivered, within two days after those reply affidavits were due). I suggest that the parties try to work out some system for cross referencing the exhibits to the affidavits to the JDB so that they do not need to be filed twice.
b. The plaintiffs shall file with the trial office for delivery to the trial judge a Supplementary Trial Record that contains a copy of the Trial Procedure Agreement, any agreements or endorsements reflecting the amendments thereto and a copy of this endorsement at least one week prior to the scheduled commencement of the trial.
c. Each party shall file with the trial office for delivery to the trial judge on the later of (i) the date prescribed under the Trial Procedure Agreement, or (ii) two days after the last date upon which Notices of Objection are due pursuant to this endorsement, a chart outlining the objections that they will be asking the trial judge to rule on in respect of the opposing parties’ trial affidavits. That chart should identify by affidavit and paragraph number and contain an excerpt of the evidence objected to, state the grounds for the objection and state the applicable rule of evidence and/or guiding legal principle(s).
d. The parties shall, in advance of the opening of trial, attempt to agree upon (or if no agreement is reached, each prepare their own) proposed schedule for openings, motions, the order of witnesses who are being called and the time allocations for each witness, and closings, to be provided for the trial judge’s consideration at the outset of the trial.
e. The parties shall consult with all witnesses who have been asked to appear for cross-examination to ascertain whether they intend to appear to testify in person or whether they prefer to appear to testify remotely (whether due to health, travel or any other reason), and determine what audiovisual arrangements may be required for any witnesses who are testifying remotely and make arrangements in advance of the trial for such.
[66] The above orders and directions are what I would consider to come within the undertaking of Ms. Habas to assist in the implementation of on behalf of the defendant, even if she is not going to continue as counsel for the defendant at trial.
Final Disposition and Implementation
[67] The following orders and directions are made on this motion:
a. The defendant shall deliver to the plaintiffs her New and Improved Defence Affidavits together with her Notice of Objection to the plaintiffs’ trial affidavits within seven days of this endorsement;
b. The plaintiffs shall delivery their reply affidavits, if any, to the New and Improved Defence Affidavits and their Notice of Objection to the New and Improved Defence Affidavits, if any, within ten days after receipt of the New and Improved Defence Affidavits;
c. The defendant shall prepare (in co-ordination with plaintiffs’ counsel) and have ready to be filed with the court the requisite number of copies of the updated JDB at least one week before the scheduled commencement date of the trial;
d. The defendant shall be permitted to withdraw her deemed admissions of the facts set out in the plaintiffs’ previously delivered Request to Admit by delivery of a response to the Request to Admit in the form she proposed in her motion within seven days of this endorsement;
e. The plaintiffs shall use reasonable diligence to obtain from their bank(s) and produce to the defendant the personal and corporate bank records for May and June 1992 requested in respect of the Manitoba businesses;
f. The defendant shall pay to the plaintiffs their costs thrown away in respect of the time spent preparing for trial based on the evidentiary record that will now be changed as a result of this motion, fixed in the all-inclusive amount of $50,000.00 on or before September 11, 2020;
g. The defendant shall pay to the plaintiffs their costs of this motion on a partial indemnity scale fixed in the all-inclusive amount of $20,000.00 and payable within 30 days of this endorsement.
h. The parties are to use their best efforts to comply with the other trial management directions that I have outlined in this endorsement.
[68] Notwithstanding Rule 59.05, the orders and directions contained herein are effective from the date of this endorsement and are enforceable without any need for entry and filing. In accordance with Rules 77.07(6) and 1.04, no formal Order need be entered and filed unless an appeal or a motion for leave to appeal is brought to an appellate court. Any party to this Order may nonetheless submit a formal Order for original signing, entry and filing when the court returns to regular operations.
Kimmel J.
Date: August 26, 2020
[^1]: The parties entered into a Trial Procedure Agreement dated June 26, 2019 that was amended at the pre-trial conferences to align with and accommodate the defendant’s requests and corresponding positions of the plaintiffs.
[^2]: These are comprised of the following:
a. Withdrawing and replacing Ms. Poka’s July 10, 2019 with a revised affidavit affirmed on March 13, 2020;
b. Delivering a supplementary affidavit of Ms. Poka affirmed on March 13, 2020;
c. Delivering a supplementary affidavit of Wasiem Diab sworn March 10, 2020;
d. Withdrawing and replacing Demitry Papasotiriou-Langeigne’s July 12, 2019 affidavit for a new affidavit affirmed on March 13, 2020;
e. Adding the affidavit of Ionnis Papasotiriou previously sworn on July 15, 2020 to the defendant’s trial affidavits.
f. Delivering trial affidavits of Niki Poka, Dimitris Gegopoulos, Lena Gegopoulos and Bassem Youssef Kirollos Youssef based on their willsay statements.
g. Delivering a new affidavit from Ms. Poka’s lawyer in Greece, Konstantinos Evaggelos Mineopoulos.
[^3]: While some of what was contained in the Notices of Objection previously delivered by the plaintiffs may have been addressed by the New and Improved Defence Affidavits, counsel for the plaintiffs indicated during oral argument that some of the old objections may still need to be addressed by the trial judge. As an example, the New and Improved Defence Affidavits still make allegations of sexual assault that the plaintiffs deny, and will argue are irrelevant and inflammatory.