Superior Court of Justice - Ontario

COURT FILE NO.: CV-16-561427

MOTION HEARD: 20210721

RE: Benjamin Hemming Plaintiff

-AND-

Oriole Media Corp. and Juice DMS Advertising Limited Defendants

BEFORE: Associate Justice Abrams

COUNSEL: J. Beeho, for the plaintiff C. Cosgriffe, for Juice DMS Advertising Limited E. Brosseau, for Oriole Media Corp.

REASONS FOR DECISION

The Motion

[1] In this wrongful dismissal action (commenced in September of 2016), the plaintiff seeks, inter alia, an accounting and payment of commissions. The plaintiff alleges that, in its defence of this action, Juice DMS Advertising Limited[^1] (“JDAL”) has “engaged in a pattern of delay and evasion” and has employed “obstructionist and dilatory tactics”. He posits that his ability to prosecute and prove his claims has been undermined, as a result.

[2] The plaintiff points to what he says are JDAL’s delays in documentary disclosure, delays in fulfillment of undertakings, improper refusal of questions posed on discovery, delivery of an affidavit that an associate judge found to contain “an unequivocal yet untrue statement [emphasis added]”, failure to answer questions arising out of questions ordered answered, failure to access records (necessary for the litigation) in a timely fashion, and delays in satisfying costs awards. The plaintiff submits that, when taken as a whole, JDAL’s disregard for its obligations and its “stymying” of his ability to advance this litigation are so “extraordinary” as to merit an Order striking out JDAL’s statement of defence and noting JDAL in default or, in the alternative, an Order compelling a representative of JDAL to reattend to be examined for discovery, establishing a timetable for next steps and appointing an associate judge to case manage this action.

Procedural History—September 2018 Onwards

[3] While the procedural history of this litigation--culminating in two discovery motions--is set out in detail at (inter alia) paragraphs 7-18 of the plaintiff’s factum, the crux of the plaintiff’s current complaints with respect to what, he submits, is JDAL’s current default on its obligations, derives from September of 2018 when Associate Justice McAfee ordered certain undertakings and refusals given by JDAL answered and ordered the reattendance of a representative of JDAL to be examined for discovery. A representative of JDAL, different than the one originally examined, attended to be discovered—as ordered. The examination took place on November 29/18.

[4] One month later, JDAL sold all of its assets, including its books and records, to Curate Mobile Ltd. (“Curate”).

[5] In May of 2019, the plaintiff brought a further motion against JDAL in respect of undertakings given and questions refused at the examination of November 29/18. Associate Justice Robinson heard the motion and ordered that best efforts be made to address certain of the undertakings and refusals. In his ruling, he concluded that (a) answers to undertakings from the November 29/18 examination were not provided until after the plaintiff confirmed that he would be moving before the court and (b) an affidavit delivered by JDAL in support of the motion before him “misrepresented…circumstances with an…untrue statement” (Costs Endorsement of Associate Justice Robinson, dated August 28/19).

[6] To respond to those questions ordered answered by Associate Justice Robinson, even on a best-efforts basis, JDAL says that it needed to seek out the cooperation of Curate as it meant accessing books and records sold to Curate by JDAL. And, indeed, it did so.

Best Efforts?

[7] In response to correspondence from plaintiff’s counsel following up on efforts made by JDAL and reminding JDAL of its obligation to pay costs, JDAL’s lawyer of record sent a letter dated October 17/19 confirming that, from its perspective, JDAL had made best efforts to answer the questions ordered answered by Associate Justice Robinson (and outlining the steps taken in furtherance of those efforts). JDAL forwarded those answers that it says it was able to provide at the time and paid, albeit late, all outstanding costs.

[8] Some two months later (in mid-December/19), plaintiff’s counsel wrote that the plaintiff did not agree that best efforts had been expended and suggested that JDAL may still have access to three databases with information pertinent to the undertakings and refusals ordered answered. He asked that the databases be searched within 7 days, failing which the plaintiff would conduct an examination of Yellow Pages’ senior vice-president and general counsel, Ms. Treena Cooper. A list of some 1000 documents, said to be outstanding still, accompanied plaintiff’s counsel’s letter.

[9] JDAL’s counsel responded that, with the Christmas holiday season being a busy time, he needed more time to consult with JDAL before he could address the plaintiff’s suggestion that the three databases identified be searched. He said that a response would be forthcoming in the New Year.

[10] On January 28/20, plaintiff’s counsel advised that, with no (substantive) response having been made to his database search demand, he would be proceeding with an examination of Ms. Cooper. He served a notice of examination for February 12/20. JDAL’s counsel responded that Ms. Cooper would not be attending to be examined on February 12^th^ and that JDAL was in the process of addressing the plaintiff’s December/19 letter. That response was not satisfactory to the plaintiff and plaintiff’s counsel indicated that, unless Ms. Cooper attended to be examined on February 12^th^, the plaintiff would obtain a certificate of non-attendance.

[11] On February 4/20, JDAL’s counsel provided an update to the plaintiff. He indicated that the three databases had not been available to him until then but that, on February 13^th^, instructions would be given to Curate (in the context of a scheduled meeting) to search the three databases identified by the plaintiff.

[12] At Curate’s instance, the February 13^th^ meeting was rescheduled to February 20^th^. On February 12^th^, the plaintiff obtained a certificate of non-attendance for Ms. Cooper and sent JDAL’s counsel a further notice of examination for Ms. Cooper to be examined on February 26/20. Upon receipt of plaintiff’s counsel’s correspondence, JDAL’s counsel advised that, through no fault of JDAL or its lawyers, the meeting at Curate had been rescheduled to later that month and that Yellow Pages’ IT team had delivered over a shared drive, which shared drive would be searched without delay to determine whether it might contain relevant documentation. With more time required for these steps, JDAL’s counsel indicated that an examination of Ms. Cooper on February 26^th^ was premature.

[13] Shortly thereafter, a further letter was sent to plaintiff’s counsel advising that (with the VIA Rail protests taking place at the time, of which the court takes judicial notice) access to Curate’s offices was still not possible such that the searches of the three databases needed to be postponed. Plaintiff’s counsel was not satisfied with the response and posited that there remained questions that hadn’t been, but could be, answered without need of an attendance at Curate’s offices. Even so, JDAL’s lawyers declined to answer questions on a “piecemeal” basis.

[14] Ms. Cooper did not attend to be examined on February 26^th^ and yet another certificate of non-attendance was obtained.

[15] Plaintiff’s counsel was not content with what he perceived to be JDAL’s further delay in addressing the Order of Associate Justice Robinson and served a further notice of examination for an examination of Ms. Cooper on March 11/20. He was of the view that there were questions that were “not dependent upon any documents or information from Curate” that could be answered, without more.

[16] On March 11/20, JDAL’s counsel advised that Yellow Pages had produced a shared drive that might contain documents relevant to the refusals and undertakings ordered answered by Associate Justice Robinson; he produced further documents; and he indicated that the three databases within Curate’s control would be searched on the next day. That database search did not take place, as planned. It was again cancelled by Curate, to be rescheduled when Curate’s offices would reopen (their having been closed due to the Pandemic). I note that throughout, JDAL’s lawyers kept plaintiff’s counsel’s updated but, from the plaintiff’s perspective, inadequately informed.

[17] Plaintiff’s counsel became frustrated by what he perceived to be JDAL’s/Curate’s inappropriate and inexorably slow pace of addressing the required review of the databases. He sent a number of letters following up with JDAL, served a supplementary affidavit of documents on behalf of his client, and threatened to report one of JDAL’s lawyers to the Law Society for having failed to respond to two emails requesting information (which emails, JDAL’s lawyers say, were not responded to as the plaintiff had been advised that, unless and until Curate reopened its offices, there was no further information available to be provided by them).

[18] Plaintiff’s counsel reiterated that the answers furnished to date were not sufficient, in his view, and served a further notice of examination for Ms. Cooper. JDAL’s lawyers declined to permit Ms. Cooper to attend to be examined, suggesting that any further examination would not constitute proper follow-up and reiterating that JDAL needed to access Curate’s records before any further responses could be made or documents could be produced.

[19] After a further certificate of non-attendance was obtained and after further exchanges and confirmation by JDAL’s counsel that JDAL continues to await the reopening of Curate’s offices, this motion was brought. The plaintiff says that (a) there remain a number of outstanding questions ordered answered, and (b) there is and has been a general failure on the part of JDAL to respond to some of the plaintiff’s letters--at all or in a timely fashion. Further, he says, there is no documentary evidence that, (at least) from late 2020 onwards, JDAL and its lawyers have been taking steps to retrieve documents from Curate, even remotely (if access to Curate’s offices has been denied them).

The Law

[20] Looking at this action’s procedural history in context, the first question to be posed is whether JDAL has made best efforts to fulfill its discovery obligations (as ordered). Relying on Gheslaghi et al. v. Kassis et al., 2003 CarswellOnt 5128 (ON SC), JDAL says that it has. A promise or requirement to employ best efforts does not guarantee that the relevant information or documents will be produced. Best efforts “…mean that counsel and [counsel’s] client will make a genuine and substantial search for the requested information and/or documentation” (at para. 7). It is not the case that JDAL paid no or little heed to the Order made by Associate Justice Robinson (or to communications sent by plaintiff’s counsel). Multiple attendances were scheduled at Curate’s offices, some answers to questions posed were provided and a share drive received from Yellow Pages was searched. Further, JDAL’s lawyers sent updates to plaintiff’s counsel.

[21] The steps taken by JDAL in compliance with Associate Justice Robinson’s July 15/19 Order are set out in detail in its counsel’s letters of October 17/19 and March 11/20. And while it is true that it was the plaintiff who identified three databases that had not been identified and/or searched by JDAL at first instance, JDAL did not decline to seek access to them or to search them. JDAL’s position, simply stated, is that it has not yet been accorded appropriate access to them (because they are in the control of a non-party that has not fully re-opened its offices, even as at the time of this motion, owing to the Pandemic).

[22] I agree with counsel for JDAL when he says that his client has not refused to produce for inspection any documents in its possession or failed to comply with a court Order, even if there is/was more that JDAL could have done/could do. But, even if I am wrong, I do not think that JDAL’s conduct rises to the level that merits striking out its pleading under Rule 30.08(2). I am not satisfied that any failings on the part of JDAL are “deliberate”, “clear and unequivocal” and/or without “a reasonable explanation…[and] a credible commitment to cure the default quickly”, save that, I accept, there is some question as to what more might be done at this time (with there being a paucity of evidence in respect of access to Curate, from mid-late 2020 onwards). “…[C]ourts usually want to ensure that a party has a reasonable opportunity to cure its non-compliance before striking out its pleading” (see: Falcon Lumber Limited v. 2480375 Ontario Inc. (GN Mouldings and Doors), 2020 ONCA 310 (at para. 57)). With the steps already taken by JDAL vis-à-vis Curate, I think that a further reasonable opportunity to follow up with Curate (and consider what more/different might be done) is warranted.

[23] While the plaintiff points to many failings on the part of JDAL in its defence of his claims, many of them pre-dated the motions heard by Associate Justices McAfee and Robinson and were the subject of sanction by both. And though a number of notices of examination were served with no one attending on behalf of JDAL to be examined, I do not accept that “[t]here is no realistic prospect of the action advancing through discovery on its merits in the foreseeable future” (Herman’s Building Centres v. Belaoussoff, 2021 ONSC 413, at para. 58). And I also do not see this as a case in which the Rules and court Orders have been “ignored repeatedly and over a number of years”, with “severe consequence” being warranted (Falcon Lumber Limited v. 2480375 Ontario Inc. (GN Mouldings and Doors, supra, at para. 39). I accept that striking out JDAL’s defence, at this time and on the record now before me, would not be “a proportional remedy in the circumstances” (Falcon Lumber Limited v. 2480375 Ontario Inc. (GN Mouldings and Doors), supra, at para. 57). JDAL has explained its delay in searching the databases within Curate’s control and, in the words of JDAL’s counsel, “has never wavered from its commitment to complete those searches as soon as it is able”. That said, I accept that the issue of when it might be able to do so remains a live issue. More will be said on this below.

[24] Much of what the plaintiff now complains of was before Associate Justice Robinson. JDAL was sanctioned by him; and, it is not for me, at this time, to reopen the hearing and sanction JDAL more significantly than Associate Justice Robinson thought appropriate. And I have no reason to question the veracity of what counsel for JDAL has said about the efforts of JDAL’s lawyers to obtain access to Curate’s databases. This is not a case of a client reporting to its counsel what it has been told; this is a case of counsel reporting directly to opposing counsel (and now the court) what they have been told.

[25] As for the failure on the part of Ms. Cooper to attend to be examined for discovery on a number of unilaterally set dates, I note that Associate Justice Robinson did not order her further attendance or require that a representative of JDAL respond to written interrogatories. JDAL’s lawyers took the view that, with Curate’s records not yet having been fully searched, any examination would not constitute proper follow-up. I understand why they were of this view (and it was not wrong or unreasonable); but, I understand, too, the plaintiff’s frustration with what appeared (and appear) to be undue delays.

[26] Both Associate Justice McAfee and Associate Justice Robinson awarded costs to the plaintiff. Those costs were paid, albeit late. There is no foundation for my striking JDAL’s defence for failure to pay costs. Then too, and in my consideration of what brought the plaintiff to court on this motion and whether JDAL’s defence ought to be struck, I note that neither Associate Justice McAfee nor Associate Justice Robinson thought that JDAL had conducted itself in so egregious or “extraordinary” a manner as to warrant an award of substantial indemnity costs.

[27] While the plaintiff submits that “JDAL’s default in this case has been persistent, deliberate and material …and…it escalated to include the swearing of an affidavit by in-house counsel which ‘misrepresented the circumstances with an unequivocal yet untrue statement’” (plaintiff’s factum at para. 88), all of this pre-dated the motion before Associate Justice Robinson. Since then, counsel for JDAL has been responsive, if imperfectly so, and JDAL’s efforts, if flawed, have not been dismissive of the plaintiff’s rights and its obligations. At least before late 2020, those efforts appear to me to be substantial and genuine.

Relief Granted

[28] In all of the circumstances, I think that a variation on the alternative form of relief sought is here appropriate. I am not prepared to strike JDAL’s defence, and neither am I prepared to grant the plaintiff unfettered access to a representative of JDAL for a further examination. I do think that the plaintiff is entitled to better understand what efforts have been made to address the documentary lacunae that Associate Justice Robinson identified and to answer questions arising out of answers given/documents produced further to his Order. I will permit an examination of a representative of JDAL, on a date to be agreed, for up to two hours. The timing may be extended, on consent, or by way of court Order, only.

[29] This action is to be timetabled but, for now and unless otherwise ordered, the set down deadline shall be March 31/22. Though the defendants do not think that case management is necessary, they do not oppose it. Given the procedural history of this action and the plaintiff’s lack of trust that the action is being defended, at least by JDAL, fairly and in good faith, and given the delays attributed to Curate, I think that light-touch case management, by me, would here be appropriate. In this way, issues that arise pending trial may be addressed in a more efficient and cost-effective manner and without need of the formality and complexity of a motion. Further, the court may be able to assist in fashioning a solution to permit access to the Curate databases.

[30] I may be spoken to on the issue of the costs of this motion. Failing agreement, submissions may be made orally or in writing. Counsel are to confer and to advise my ATC, Ms. Charlebois (teanna.charlebois@ontario.ca), as to how they wish to proceed—this by November 5/21.

October 15, 2021 “Original Signed by Associate Justice Abrams”

[^1]: Acquired by Yellow Pages in March of 2016.