COURT FILE NO.: CV-19-00615591
DATE: 20210407
ONTARIO SUPERIOR COURT OF JUSTICE
BETWEEN:
Venturistic Investments Inc. Plaintiff/Defendant by Counterclaim
– and –
Zipporah “Zee” Mason Defendant/Plaintiff by Counterclaim
Alissa N. Winicki, for the Plaintiff/Defendant by Counterclaim
No one appearing for the self-represented Defendant/Plaintiff by Counterclaim
HEARD: April 6, 2021
REASONS FOR DECISION
VELLA, J.
[1] This motion for summary judgment, brought by the Plaintiff/Defendant by Counterclaim, Venturistic Investments Inc. (“Venturistic”), was heard today virtually by Zoom videoconference.
[2] I granted the motion for summary judgment in favour of Venturistic, and dismissed the Counterclaim, for reasons to follow. These are the reasons.
Preliminary Issue
[3] The Defendant/Plaintiff by Counterclaim, Zipporah “Zee” Mason (“Ms. Mason”) did not appear.
[4] I am satisfied that Ms. Mason was provided with notice of today’s hearing by the lawyer for Venturistic, including service of the Notice of Motion, Motion Record and Factum, as well as the Motion Confirmation Sheet, and was provided the Zoom link for today’s hearing by the court. As well, Ms. Mason was provided with the endorsements of Justice Chalmers (who fixed this date at civil practice court) and Justice Dunphy (filed with the motion record). Affidavits of service were filed.
[5] Furthermore, Ms. Winicki, lawyer for Venturistic, advised that she has received no responses to her emails sent to Ms. Mason.
[6] Accordingly, having waited for 15 minutes, I proceeded. At any time during the course of the motion, Ms. Mason could have joined, but did not.
Materials filed
[7] Venturistic filed a motion record consisting of the Notice of Motion and the affidavit of Mui “Michelle” Sham Bong, sworn March 15, 2021. Ms. Bong is the owner and the sole proprietor of the corporate plaintiff.
[8] Ms. Bong was not cross examined, and Ms. Mason did not file any materials, including any affidavit.
[9] Venturistic also filed a factum and book of authorities.
Summary Judgment
[10] Having regard to the Supreme Court of Canada’s judgment in Hyrniak v Mauldin, 2014 SCC 7, I am satisfied that there is no genuine issue requiring a trial with respect to the claim or defence, or the counterclaim and the defence thereto.
[11] I am able to reach a fair and just determination on the merits on this motion for summary judgment. I have sufficient, uncontested, evidence before me that allows me to make the necessary findings of fact and allows me to apply the law to the facts. This procedure is a proportionate, more expeditious and less expensive means, than would be a trial, to achieve a just result.
[12] Under rule 20.04(2)(a), the court shall grant summary judgment in the event it is satisfied that there is no genuine issue requiring a trial with respect to a claim or defence.
Analysis and Decision
[13] Venturistic’s claim seeks judgment against Ms. Mason for the sums it claims Ms. Mason stole through a fraudulent cheque scheme.
[14] Venturistic operates a lash extension business. Ms. Mason worked for Venturistic, part time, as an independent contractor. Ms. Mason was paid for her services at an hourly rate, by cheques prepared by Ms. Bong.
[15] Ms. Mason worked for Venturistic as a lash extension specialist or lash artist from October 2017 to January 8, 2019 and was paid on or about the 1st and 15th of each month.
[16] On January 4, 2019, Ms. Mason unexpectedly provided two weeks’ notice of termination to Ms. Bong by text message.
[17] On January 8, 2019, Ms. Bong was contacted by a business analysis with the CIBC where Ms. Mason banked. Ms. Bong was then put in contact with CIBC’s fraud department regarding a cheque she had written in favour of Ms. Mason dated January 2019 in the sum of $146.00. Ms. Bong was advised that Ms. Mason had altered this cheque three times and deposited each altered cheque via mobile banking. The original sum of $146.00 had been altered to $196.00, $2,146.00 and $2,496.88.
[18] As a result of this discovery, Ms. Bong initiated an investigation of all of the cheques she had written in favour of Ms. Mason and discovered that Ms. Mason had engaged in a process of altering cheques written in her favour by Ms. Bong, and re-deposited the fraudulent cheques several times.
[19] The affidavit evidence included as exhibits copies of the original and fraudulent cheques and the alterations are visible.
[20] Ms. Bong’s own bank reimbursed Ms. Bong for the fraudulently deposited cheques for the 90 day period preceding the discovery of the fraud (in accordance with its policy), in the sum of $13,840.52.
[21] In a summary judgment motion, a defendant cannot rest on allegations made in its statement of defence. The defendant must put forward evidence, and indeed must put her best foot forward at the motion.
[22] I am satisfied that Venturistic has proven that Ms. Mason engaged in fraudulent conduct whereby she altered cheques written in her favour by Venturistic for service rendered and stole the sum of $38,139.15 through this illicit scheme.
[23] I am further satisfied that Ms. Mason should not be the beneficiary of the reimbursement made by Ms. Bong’s bank and accordingly am not deducting that sum from the damages awarded.
Counterclaim
[24] Ms. Mason issued a counterclaim seeking outstanding wages in the sum of $224.00.
[25] I am satisfied on the evidence filed that Ms. Mason was paid this sum when she received the Statement of Claim.
[26] Therefore, the counterclaim is dismissed.
Prejudgment Interest and Post Judgment Interest
[27] Ms. Winicki has asked me to exercise my discretion under s. 130 of the Courts of Justice Act to award post judgment interest at the rate of 2% per year, and to fix the date for the commencement of prejudgment interest to the date of the first fraudulent activity, being January 10, 2018. Under ss. 127 and 129 Courts of Justice Act, for the period in question, the rate for post judgment interest is pegged at 1.8%. Under s. 128 of the Courts of Justice Act the prejudgment interest accrues from the date the cause of action arose.
[28] I am not inclined to increase the rate of post judgment interest.
[29] However, upon reflection, I am exercising my discretion under s. 130 of the Courts of Justice Act to award pre-judgment interest at the rate of 2.0% from January 10, 2018, being the date on which the fraudulent activity commenced. Venturistic was not able to discover the cause of action until it was alerted to it by the CIBC because of the nature of the fraudulent activity. Venturistic should not be out of pocket as a result of the fraudulent activity in terms of having lost the use of the stolen funds. In my view this is a fair and equitable result.
Costs
[30] Ms. Winicki has requested costs be awarded on a substantial indemnity basis. I agree. The conduct of Ms. Mason is reprehensible, and the counterclaim was frivolous given that the final pay cheque was delivered with the statement of claim (and notwithstanding there would have been a reasonable basis for a set off, had Venturistic declined to pay the last pay period to Ms. Mason).
[31] I have reviewed the cost outline filed by Ms. Winicki and find the time incurred and associated hourly rates to be reasonable. However, counsel provided me with only her partial indemnity rate ($200 per hour) and full indemnity rate ($250.00 per hour). The full indemnity legal fee sought is $9,735.00 plus HST plus disbursements.
[32] Venturistic had to undertake a forensic investigation in preparation of the lawsuit. I also find that, given the intentional misconduct of Ms. Mason having engaged in dishonesty, it is reasonably within her expectations that she would have to pay costs on a substantial indemnity basis in the amount sought by Venturistic.
[33] I have considered the factors under rule 57.
[34] In the circumstances, I do not think it fair or equitable that Venturistic be out of pocket for the legal fees incurred in prosecuting the action and defending the counterclaim.
[35] I am exercising my discretion under s. 131(4)(c) of the Courts of Justice Act, and awarding costs in favour of Venturistic against Ms. Mason, on a substantial indemnity basis fixed in the sum of $9,000 plus HST in the sum of $1,170.00, together with disbursements in the sum of $659.00 and payable forthwith.
[36] As I advised yesterday, a draft judgment, reflecting these terms, may be provided for my consideration by uploading it on to CaseLines.
Justice S. Vella
Released: April 7, 2021
COURT FILE NO.: CV-19-00615591 DATE: 20210407
ONTARIO SUPERIOR COURT OF JUSTICE
BETWEEN:
Venturistic Investments Inc. Plaintiff/Defendant by Counterclaim
- and -
Zipporah “Zee” Mason Defendant/Plaintiff by Counterclaim
REASONS FOR JUDGMENT
Justice S. Vella
Released: April 7, 2021