Bracebridge Court File No.: CV-13-94-00

Date: 2020-10-05

Superior Court of Justice - Ontario

Re: Christopher M. Tousenard and Ann Marie Tousenard, Plaintiffs

And:

Paul Lowe and Tara Lowe, also known as Tara Dunn, Defendants

Before: The Honourable Madam Justice S.E. Healey

Counsel: Cindy Cohen, for Paul Lowe W. Robert Kerr, for Tara Dunn

Heard: In Writing

Costs Endorsement

[1] The defendant Paul Lowe successfully moved to set aside the judgment obtained by his former spouse, Tara (Lowe) Dunn, on the crossclaim in this action. Tara Dunn, despite being represented and duly served with the motion, did not file responding material.

[2] Ms. Dunn’s cost submissions were prepared by her lawyer. In those submissions Ms. Dunn sought to introduce information that is not in a sworn affidavit to explain why she did not consent to the motion, which was primarily her belief that Mr. Lowe had been successfully served with her cross-claim and her allegation that he had notice of the judgment earlier than stated in his evidence.

[3] I am disregarding all of Ms. Dunn’s comments that seek to relitigate the motion, on the obvious basis that the matter has already been decided, it is unfair to the moving party to attempt to introduce unsworn evidence that counsel has not had an opportunity to cross-examine on, and it is wholly inappropriate to seek to relitigate a motion in one’s costs submissions.

[4] Mr. Lowe has set out the history of this motion in his affidavit in support of the motion, as well as in his costs submissions. That history has not been refuted by Ms. Dunn. Prior to bringing the motion, by letter dated October 23, 2019 from his counsel, Mr. Lowe sought Ms. Dunn’s consent to set aside the motion on the basis that he had not been served with her cross-claim. It was also noted in that letter that the Bracebridge court office did not have a copy of an Affidavit of Service attesting to service of the cross-claim on Mr. Lowe. The response from Ms. Dunn’s U.S. counsel, who was enforcing the judgment, was that the judgment was valid and Ms. Dunn intended to move forward with collection efforts. Because of that lack of consent, Mr. Lowe was put to the expense of having to prepare, serve and file this motion, all while living in Arizona.

[5] It is clear from the submissions made by Ms. Dunn that, at the time of her counsel’s initial response, she had no proof by way of a sworn Affidavit of Service that Mr. Lowe had been served with the cross-claim. She has never been able to obtain that document despite a lengthy passage of time.

[6] Having not received any responding material, Mr. Lowe’s counsel had to make several inquiries with Ms. Dunn’s counsel in order to complete a Motion Confirmation form for the motion originally returnable on December 16, 2019. Ultimately, Ms. Dunn sought an adjournment in order to file responding material and conduct cross-examinations, if necessary. Counsel agreed to a timetable, with the responding material being due by December 23, 2019. The new return date for the motion was to be set through the trial coordinator’s office.

[7] No responding material was filed by the agreed-upon deadline or subsequently. Mr. Lowe’s counsel made repeated inquiries about moving the matter forward, which went unanswered. Ultimately, she moved to schedule the matter to be heard on March 31, 2020. The suspension of court operations then intervened due to the pandemic, and the motion was not heard.

[8] As soon permitted by Practice Direction, Mr. Lowe’s counsel submitted the motion in writing as required. She once again served Ms. Dunn’s counsel. Again, no responding material was filed. Nor was there any request from Ms. Dunn for an adjournment; this is significant because Ms. Dunn claims to have been making inquiries with plaintiff’s counsel to attempt to learn whether their file contains the necessary affidavit of service, and she submits that these inquiries were hampered in part by the pandemic. Significantly, in the interim she had confirmed for herself that neither the lawyer who initially acted for her on the cross-claim nor the court office were able to locate an Affidavit of Service of the cross-claim on Mr. Lowe. Yet she still did not consent to the relief being sought on this motion.

[9] Ms. Dunn’s counsel argues that she should not have to pay costs because she did not act unreasonably in requiring Mr. Lowe to “prove his claims”. She did not put him to any additional expense by filing responding material or cross-examining. She further argues that Mr. Lowe was not prejudiced in any way by this judgment because enforcement proceedings were suspended by agreement between counsel. I do not consider this last submission to have any bearing on the costs of the motion.

[10] There is clear authority that default judgment obtained by way of a procedural irregularity should be set aside, which includes a situation where service has not been effected as required: Tobias v. Di Carlo 2014 ONSC 6717 (S.C.J.) at paras. 4-8; Guillaume v. Toronto (City) 2010 ONSC 5045 (S.C.J.) at para. 33; Dawson’s Marina Ltd. v. Telfer (2005), 38 C.P.C.(6th) 43 (S.C.J.) at paras. 22 and 23; Royal Trust Corp of Canada v. Dunn, 1991 CarswellOnt 468 (Gen. Div.), at para. 20; Don Bodkin Leasing Ltd. v. Rayzak, 1993 CarswellOnt 4016 (Gen. Div.), at para. 2; Tomazio v. Rutale,1995 CarswellOnt 1336 (Gen. Div.), at paras. 6 and 7; and Miller v. Muthulingam, 1998 CarswellOnt 4159 (Gen. Div), at para. 6. Although these cases were not relied on by the moving party on the motion, Ms. Dunn’s counsel is presumed to be aware of the law and so Ms. Dunn should have considered the merits of her position very carefully and cautiously once she failed to come up with an affidavit of service.

[11] Mr. Lowe cannot prove a negative. His sworn evidence was that he had never been served, and that the Bracebridge court filing office did not have the Affidavit of Service. If such an affidavit of service existed, it was within the control of Ms. Dunn to obtain. Further, several of the cases cited above also stand for the proposition that the onus is on Ms. Dunn to prove service: see, for example, Guillaume, at para. 33. Yet even when her inquiries failed to yield such a document, she refused to consent to the motion. Not once but twice. Mr. Lowe has been put to unnecessary costs in having to prepare and serve the motion, not once but twice. And those costs have escalated due to his counsel having to pursue the motion in the face of a non-responsive respondent.

[12] Mr. Lowe has been successful on the motion and is entitled to his costs. His counsel seeks costs on a substantial indemnity basis. Costs on a higher scale are generally only awarded when the court wishes to express its disapproval of the conduct of a party to the litigation: Net Connect Installation Inc. v. Mobile Zone Inc., 2017 ONCA 766 (C.A.), at para 8. Counsel relies on Boswell, J.’s decision in Shedden Investments Inc. v. Freitas, 2019 ONSC 5693 (S.C.J.), in which substantial indemnity costs were awarded following a similar motion. In Shedden Investments, plaintiff’s counsel had obtained default judgment without notice to the defendants’ counsel, who had filed a Notice of Intent to Defend but had also written to seek an indulgence while he investigated the matter. The facts in Shedden Investments are quite different from this case, where there is no evidence before the court about what occurred at the time of the exchange of pleadings, other than the lack of evidence of service on Mr. Lowe.

[13] In this case, the conduct of Ms. Dunn reaches the point of being egregious by March 2020, by which time she had had ample time to obtain the Affidavit of Service if one existed. Having not obtained that necessary evidence, there was no meritorious basis for her putting Mr. Lowe to the expense of scheduling the matter for argument. Adding to her unreasonable conduct was her uncooperative lack of response to his lawyer’s inquiries about her intentions. This was exacerbated by her continuing lack of response once the motion was re-served to be heard in writing and filed at the end of July, 2020.

[14] In sum, after considering the factors set out in r. 57.01, I am exercising my discretion to award part of the costs on a substantial indemnity basis. This scale of costs will be applied to all work undertaken after the initial adjournment. Costs will be awarded on a partial indemnity basis for all steps taken up to that point, having reference to the Bill of Costs filed. On this calculation, fees and disbursements total $6,836.90. Ms. Dunn has retained counsel throughout this proceeding and will be aware of the costs involved in litigation. Mr. Lowe had no choice but to incur these costs in order to set aside a judgment improperly obtained, and it is only fair that a good portion of his costs be recovered. The amount is reasonable given all of the steps that had to be undertaken, which were increased by Ms. Dunn’s lack of responsiveness.

[15] For all the foregoing reasons, this court orders that Tara Dunn shall pay costs of this motion to Paul Lowe fixed in the amount of $6,835 inclusive.

HEALEY J.

Date: October 5, 2020