COURT FILE NO.: CV-16-5285
DATE: 2020 02 13
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
SARABJOT SINGH
Plaintiff
- and -
ACE MARKETING VENTURES INC., MOHAN MALHOTRA, and JASWANT MANN
Defendant
Devesh Gupta for the Plaintiff, Sarabjot Singh
Ajay Duggal for the Defendant, Mohan Malhotra and Ace Marketing Ventures Inc.; and Joga Singh Chahal for the Defendant Jaswant Mann
HEARD: October 15, 2019
REASONS FOR DECISION
Shaw J.
Overview
[1] On December 2, 2016 the plaintiff commenced an action for damages for breach of contract. The plaintiff alleges that he had an oral agreement with Ace Marketing Ventures Inc. (“Ace”), Mr. Jaswant Mann and Mr. Mohan Malhotra whereby Mr. Singh, Mr. Mann and Mr. Malhotra would collectively own and operate Ace as equal partners to provide real estate marketing and sales services in the Greater Toronto Area. The defendants, Mr. Malhotra and Mr. Mann are directors of Ace.
[2] The defendants filed a Statement of Defence dated January 20, 2017 alleging that they retained the services of Mr. Singh to create promotion materials and radio scripts and in return he was provided with free rent at Ace so that he could work full time in his mortgage business.
[3] Unsworn Affidavit of Documents were provided to plaintiff’s counsel on August 18, 2017. The Affidavit of Documents for each defendant listed the same six items as schedule A documents as follows:
Pleadings and Proceedings
Ace Marketing Ventures Inc. Corporate Profile
List of mortgages completed by the plaintiff during the relevant period
Sarabjot Singh’s T4A for 2015 issued to Ace Marketing Ventures Inc.
Sarabjot Sing’s T4A for 2015 issued to Mohan Malhotra
Three TD Canada Trust cheques date November 17, 2015 from Ace Marketing Ventures Inc. to the plaintiff
[4] There were no documents listed in schedule B or C. Mr. Malhotra later provided a sworn affidavit of documents on behalf of himself and on behalf of Ace.
[5] On November 9, 2017 counsel for the plaintiff wrote to counsel for the defendant Mr. Malhotra and Ace as follows:
With respect, the Defendant’s Affidavit of Documents, we request that your client provide the below production two weeks prior to examinations for discovery”
a) List of mortgages completed by the Plaintiff between September 2014 to December 2014;
b) Ace Marketing Ventures Inc. earnings between January 2015 to November 2015;
c) Copies of cheques by the Defendants between September 2014 to November 2015 paid to the plaintiff;
d) Copies of any agreements signed between the Plaintiff and Defendants in their possession; and
e) Any correspondence (email, text, or other) between the Plaintiff and the Defendants.
[6] Counsel for Mr. Malhotra and Ace responded on November 29, 2017 as follows:
My response to the questions posed, in the order they appear:
List of mortgages completed by the plaintiff between September 2014 and December 2014
My clients do not have this information in their possession. Your client should have this information in his possession.
Ace Marketing Ventures Inc. earnings between January 2015 to November 2015
My client is in the process of obtaining this information from his accountant and will forward to your attention as soon as it is received. We hope to have this information by the end of the week, i.e. December 1.
Copies of cheques by the defendants between September 2014 to November 2015 paid to the plaintiff:
See attached one further cheque dated July 25, 2015. We have provided all other cheques as scheduled in our affidavit of documents.
Copies of any agreements signed between the plaintiff and defendants in their possession:
There is no agreement between the Plaintiff and the Defendant.
Any correspondence (mail, text, or other) between the plaintiff and defendants
My clients are in the process of searching for any further mail, texts, or other and will provide same if located.
[7] Examinations for discovery were then conducted on December 7, 2017. There was no request made for undertakings at the discoveries. While Mr. Mann and Mr. Malhotra were questioned in their personal capacity, there is no evidence if anyone was produced to be questioned on behalf of Ace.
[8] No request was made for any further disclosure or a further affidavit of documents from any of the defendants until the plaintiff’s motion initially returnable August 29, 2019. Prior to that motion, Mr. Malhotra had served a motion initially returnable on May 17, 2019 seeking an order that the plaintiff answer undertakings given at his examinations for discovery. That motion was heard on August 27, 2019 and an order made that the plaintiff comply with refusals, undertakings and advisements by September 30, 2019.
[9] The plaintiff’s motion seeking a further affidavit of documents was served as a countermotion record returnable May 31, 2019 and was heard on October 15, 2019. In addition to requesting a further and better affidavit of documents, the plaintiff also requests that the defendants produce the following:
Financial statements of each of the Defendants for the financial years including the period form September 2014 to November 2015;
A list of and details of all real estate deals that were entered into by clients of the Defendants between September 2014 to November 2015 including:
a. List of transactions entered into by clients under the names of Jaswant Mann and Mohan Malhotra between September 2014 and November 2015 through their respective real estate brokerages in this time period; and
b. The day on which Mohan Malhotra obtained his licence to practice as a real estate agent under the applicable legislation;
c. List of and details of all mortgage transactions completed by the Defendants between September 2014 and November 2015;
d. Emails, text messages, WhatsApp messages, and other correspondence from and to each of the Defendants that relate to this matter including;
Communication regarding deals worked on by me and clients assisted by me; and
Communication regarding structure of the partnership and working relationship between me and the Defendants.
Details of commissions received from all deals that were entered into by clients through the Defendants for the period between September 2014 to November 2015
[10] Counsel for the plaintiff clarified that the disclosure he is seeking for the two individual defendants is their income tax returns and not their financial statements. He is seeking financial statements from Ace.
[11] The plaintiff also seeks an order that the defendants appear for continued examinations for discovery.
Issue and Position of the Parties
[12] The issue is whether, after examinations for discovery has been completed, the plaintiff can now ask for further productions, when he had the opportunity to ask for that production at discoveries but failed to do so.
[13] The plaintiff’s position is that the disclosure requests are relevant to the issues in dispute as set out in the pleadings and the defendants’ have an ongoing duty to provide disclosure.
[14] The defendants’ position is that the requested disclosure is not relevant and is a fishing expedition launched in response to their motion to compel compliance with undertakings. Secondly, their position is that the plaintiff had his opportunity to request further documents and disclosure at examinations for discovery and failed to do so.
Analysis
[15] There are two Rules to consider – Rule 30.06 and 30.07 of the Rules of Civil Procedure.
[16] Under Rule 30.06, where the court is satisfied by evidence that a relevant document in a party’s possession, control or power and has been omitted from the party’s affidavit of documents, the court may order cross-examination on the affidavit of documents, order service of a further and better affidavit of documents, order the disclosure or production for inspection of the document and inspect the document for the purpose of determining the relevance of a document. The Rule does not address when a party can move for a further and better affidavit of documents.
[17] Under Rule 30.07, there is an ongoing disclosure obligation where a party, after serving an affidavit of documents, either comes into possession or control or obtains power over a document that relates to a matter in issue, or discovers that the affidavit is inaccurate or incomplete. Under those circumstances, the Rule provides that the parties shall forthwith serve a supplementary affidavit specifying the extent to which the affidavit of documents requires modification and disclosing any additional documents.
[18] The discovery transcripts of Mr. Malhotra and Mr. Mann were produced. No undertakings were requested at either discovery. The discovery of Mr. Mann was 18 minutes and a portion of that time was spent by counsel for Mr. Mann on re-examination.
[19] Mr. Malhotra’s discovery was conducted the same day. His discovery commended at 10 am and was approximately one hour as Mr. Mann’s discovery commenced at 11:18 am that morning.
[20] Thus, very brief discoveries were conducted and neither of the individual defendants were asked if they had in their possession, any of the documents the plaintiff is now requesting. Based on the transcripts, the individual defendants were questioned in their personal capacity and not on behalf of Ace.
[21] What is unexplained is why the plaintiff did not ask Mr. Mann or Mr. Malhotra for any of the documents at discoveries, which he is now requesting. Counsel for the plaintiff did not even ask if they had any of the requested documents in their possession. While the plaintiff asserts that the documents he is requesting are relevant he gives no explanation with respect to why he waited almost 2.5 years after the litigation was commenced to request what he considers to be relevant documents.
[22] The discoveries were conducted and completed based upon the affidavit of documents that the plaintiff received. After counsel received the affidavit, he wrote to counsel for Mr. Malhotra and Ace requesting some additional disclosure but not for the documentation he is now requesting. Counsel for Mr. Malhotra and Ace responded in a timely fashion.
[23] The plaintiff asserts that the requested disclosure is relevant as it relates to his claim that he had an oral agreement with the defendants and was to have been paid a commission for deals he referred to the defendants between September 2014 to January 2015 and then 33.3% of all commission earned by the defendants from January 2015 to November 2015. The plaintiff claims that between September 2014 to January 2015 he earned total payments of approximately $75,000 and between January 2015 to November 2015 he should have earned $250,000. The records he is now requesting relate to not only establishing if there was an agreement between the plaintiff and defendants but also records that may assist in determining the income earned by the defendants during the relevant time period.
[24] I do not dispute that the documents that are being requested may be relevant based on the pleadings in the action. There is no evidence, however, that those documents are in the possession, power or control of the defendants. The issue is whether the plaintiff can now request these documents, after he has conducted his examination for discovery.
[25] With respect to Ace, if neither Mr. Malhotra or Mr. Mann were asked if they were being questioned as a representative of Ace, then the plaintiff can conduct an examination for discovery of Ace and request whatever documents and records he considers are relevant. He can ask for productions by way of an undertaking. A number of the documents, he is now requesting, but likely not all, may be requested from Ace. For example, it is unlikely that Ace can be asked to produce Mr. Malhotra’s or Mr. Mann’s personal income tax returns.
[26] With respect to the request for further documents from Mr. Malhotra and Mr. Mann, in my view, the rules regarding discovery are such that each party has an opportunity to question the opposing party once. In limited circumstances, a party can request leave of the court for a party to attend a second examination. It is not a matter of right that a party can examine for a second time. Furthermore, discoveries are not designed such that if the examining party thinks of further questions or decides further documents should have been requested that they can request the opposite side reattend to answer more questions or produce more documents.
[27] In effect, the plaintiff is saying that there must be more documents such as emails or messages that the individual defendants should have in their possession. This is insufficient evidence to make an order for further production. The plaintiff ought to have asked the defendants during their discovery whether these documents existed and then orders for production could have been made if the defendants refused to produce relevant documents that were in their control or possession; (Bow Helicopters v. Textron Canada Ltd, 1981 CarswellOnt 398 at para. 9).
[28] I also consider the timing of this request for additional disclosure to be suspect as it was only made in response to the defendants’ motion. No undertakings were requested or given during the discoveries, nor was there any request for any further affidavit of documents until the plaintiff was served with a motion record seeking that he complies with outstanding undertakings.
[29] The plaintiff has questioned the individual defendants and made no request for any further production. His discovery is completed. He had his opportunity to request further documents from them and he failed to do so. Mr. Malhotra and Mr. Mann are not required to produce any additional records as there is no evidence of any additional documents being in their power, control or possession.
[30] The plaintiff may schedule an examination for discovery of Ace and may request from Ace whatever relevant documents the plaintiff considers necessary which are in the possession, control or power of Ace.
[31] I also note that counsel for Mr. Malhotra had indicated in his letter dated November 29, 2017 that he would provide information regarding Ace’s earnings between January 2015 and November 2015. He also indicated that his clients were looking for further emails, texts or others exchanged with the plaintiff. That search should also include WhatsApp communications as well. If those documents have not yet been produced, they should be produced forthwith, if in existence.
[32] As success has been divided, there shall be no order as to costs.
L. Shaw J.
Date: February 13, 2020
COURT FILE NO.: CV-16-5285
DATE: 2020 02 13
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
SARABJOT SINGH
Applicant
– and –
ACE MARKETING VENTURES INC., MOHAN MALHOTRA, and JASWANT MANN
Respondent
REASONS FOR DECISION
L. Shaw J.
Released: February 13, 2020