Norland Farms (Algoma) Ltd. v. Co-Operators General Insurance Company et al
SAULT STE. MARIE COURT FILE NO.: CV-20-28379
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Norland Farms (Algoma) Ltd. v. Co-Operators General Insurance Company et al
BEFORE: The Honourable Madam Justice K.E. Cullin
COUNSEL: A. Aldersley, for the Plaintiff P. Santini, for the Defendants, Co-Operators General Insurance Company and Greg McAuley No-one appearing for the Defendants, John Palmerio Insurance Ltd. and John Palmerio
HEARD: August 6, 2021
ENDORSEMENT
CULLIN, J.
Overview
1This is a motion, brought by the plaintiff, seeking an extension of time to complete the examination for discovery of the representative of the defendant, Co-Operators General Insurance Company (“Co-Operators”). The defendant Co-Operators opposes the motion. The defendants John Palmerio and John Palmerio Insurance Ltd. (collectively, “Palmerio”) take no position on the motion.
Summary of the Facts
2The plaintiff, Norland Farms (Algoma) Ltd. (“Norland Farms”) is a farm corporation insured by the defendant, Co-Operators Insurance Company (“Co-Operators”), under a farm insurance policy. On April 24, 2019, Norland Farms suffered a fire, which resulted in the loss of its main dairy as well as its dairy business.
3On April 21, 2020, the plaintiff commenced proceedings against the defendant Co-Operators and its insurance adjuster Greg McAuley, and against its insurance brokers John Palmerio and John Palmerio Insurance Ltd. The proceeding was defended by Co-Operators and McAuley on August 11, 2020 and by Palmerio on August 14, 2020. The defendants’ pleadings also include crossclaims.
4Among other things, the plaintiff’s statement of claim alleges that its property was underinsured, that it was incorrectly advised regarding the terms of its available insurance, and that its loss was inappropriately adjusted by Co-Operators and McAuley. The pleading alleges breach of contract, negligence, and negligent misrepresentation. The plaintiff claims damages of $2.6 million, including damages associated with the loss of its physical property and its business income losses, as well as punitive and exemplary damages.
5On November 23, 2020, counsel participated in a discovery planning meeting by telephone. Following that meeting Mr. Connolly, counsel for the plaintiff, produced a preliminary discovery plan (the “Discovery Plan”) which was circulated to all counsel under cover of an email dated November 23, 2020. The email asked counsel to sign and return the document if it met with their approval.
6The Discovery Plan addressed several issues, including the following:
a. That discoveries would be conducted virtually on January 13, 14, and 15, 2021.
b. That the order of discoveries would be:
i. Carolyn Newlands, a representative of the defendant Co-Operators;
ii. Greg McAuley, defendant;
iii. John Palmerio, defendant, and a representative of the defendant Palmerio;
iv. Patrick Connolly, a representative of the plaintiff Norland Farms.
c. That a further planning meeting would take place on December 18, 2020 at 11:00 a.m.
7The Discovery Plan did not address the length of the examination of any of the parties or their representatives. There is no evidence that this was discussed at the planning meeting.
8On December 1, 2020, Mr. Clements, counsel for the defendants Palmerio, forwarded email to all counsel requesting clarification of the “Pleadings” section of the Discovery Plan and confirming that his client was available for discovery on January 14, 2021. Mr. Kitigawa, counsel for the defendants Co-Operators and McAuley, responded by email the same day echoing the comment regarding the “Pleadings” section of the Discovery Plan and advising that he was attempting to confirm Mr. McAuley’s availability for discovery; no reference was made to Ms. Newlands’ availability or attendance for discovery.
9Defence counsel did not sign and return the Discovery Plan as requested by counsel for the plaintiff.
10The plaintiff served a notice of examination on January 12, 2021. It requested the attendance of Co-Operators General Insurance Company and Gregory McAuley for discovery on January 13, 2021. No representative for Co-Operators was named in the notice of examination.
11On January 13, 2021 at the commencement of discoveries, Mr. Kitigawa advised that Carolyn Newlands was not in attendance and would not be produced for examination. Mr. Kitigawa advised that Ms. Newlands did not have knowledge regarding the matters at issue and proposed that Greg McAuley be produced both on his own behalf and as the representative for Co-Operators.
12Mr. Connolly objected to the production of Greg McAuley as the representative for Co-Operators. It was agreed that an informed representative for Co-Operators would be produced at a later date. The discoveries of the remaining parties and representatives proceeded.
13The discovery of the defendant McAuley proceeded on January 13, 2021 and was 3 hours and 44 minutes in length. The discovery of the defendant Palmerio proceeded on January 14, 2021 and was 4 hours and 42 minutes in length.
14Mid-way through the discovery of the defendant Palmerio, Mr. Clements and Mr. Kitigawa raised the approaching end of the plaintiff’s time limit to complete its discovery pursuant to the Rules of Civil Procedure. Mr. Connolly argued that no time limits were discussed or agreed upon prior to the commencement of discoveries, and that he would be bringing a motion if it was counsel’s intention to bind him to a strict time limit. The discovery of the defendant Palmerio was completed. At that point, the plaintiff had exceeded its seven-hour time limit for discoveries.
15On January 29, 2021, Mr. Kitigawa sent an email to all counsel. It noted that the plaintiff had exceeded its time limit for discoveries, but that the defendant Co-Operators was prepared to produce Rebecca McGillivray, an underwriting technical specialist, to answer underwriting questions. The defendant Co-Operators was prepared to produce Ms. McGillivray for not more than two hours.
16Mr. Connolly provided his available dates for discovery and requested a CV and job description for Ms. McGillivray. He did not comment on the defendant Co-Operators’ proposed time limit of two hours for the discovery.
17The discovery of Ms. McGillivray was conducted on February 5, 2021. The discovery was terminated by the defendant Co-Operators when two hours had elapsed. Mr. Connolly objected to the termination of the discovery and indicated on the record that he required at least another hour and a half to complete his questioning.
Issues in Dispute
18The court has been asked to rule on the following issues:
a. Should the Affidavit of Sarah E. Russell on behalf of the plaintiff, sworn on March 26, 2021, be struck, or be given little weight?
b. Should the Plaintiff be granted leave to exceed the time permitted for its examination for discovery of the defendant Co-Operators by a further two hours?
The Law
Affidavits for Use on Motions
19Pursuant to Rule 39.01(4) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, an affidavit for use on a motion may contain information beyond the first-hand knowledge of the deponent, provided that the source of the information and the deponent’s belief of the information are specified in the affidavit.
20It is not unusual for the court to receive affidavit evidence sworn by lawyers or law office staff. What is sometimes the subject of debate is the circumstances in which it is appropriate for such evidence to be relied upon. As noted by the court in Mapletoft v. Christopher J. Service, 2008 CanLII 6935 (ON SC) (para. 9):
In motions court evidence is normally tendered by way of affidavit. As a matter of practical convenience it is not uncommon for affidavits to be sworn by a staff member or by another lawyer in the firm. This practice is followed and permitted for the obvious reason that it would be unnecessarily cumbersome and costly to require routine facts to be deposed by the client or by an outside independent source. In some circumstances the first hand knowledge is peculiar to counsel or the law firm and the knowledge of the client would actually be second hand. This might be true of procedural information such as receipt or service of documents, correspondence, file management or chronology. Convenience, cost effectiveness and efficiency are important considerations. The countervailing concern however is that the practice not be allowed inappropriately in circumstances where counsel becomes a material witness.
21One consideration when determining whose affidavit evidence to submit in support of a motion is the anticipated use of the affidavit. As noted by the court in Mapletoft (para. 11):
Generally speaking the decision concerning who should swear an affidavit is a legitimate tactical decision because the deponent may be subject to cross examination…a test of propriety might be whether the party tendering the affidavit should reasonably have anticipated that the facts were disputed and cross examination might be necessary. By virtue of Rule 39.01(4) evidence based on information or belief is admissible on a motion but that does not mean it will be given undue weight nor that adverse inferences may not be made. On contentious matters the best evidence from the person with most direct knowledge will be the strongest and most persuasive evidence. (footnotes omitted)
22The Rules of Professional Conduct also provide guidance about the reliance on a lawyer’s evidence at a hearing. Pursuant to Rule 5.2-1, a lawyer who appears as an advocate may not testify or submit their own evidence at a hearing unless permitted to do so by law or by the tribunal, or unless the matter is purely formal or uncontroverted. The commentary regarding this rule notes that, when acting as an advocate, a lawyer should not create a circumstance in which they are appearing as an unsworn witness or are putting their own credibility at issue.
23In Mapletoft, Master McLeod (now Regional Senior Justice McLeod) provided these instructive guidelines regarding the use of lawyers’ affidavits:
For the guidance of counsel in future, I propose the following guidelines:
a) A partner or associate lawyer or a member of the clerical staff may swear an affidavit identifying productions, answers to undertakings or answers given on discovery. These are simple matters of record, part of the discovery and admissible on a motion pursuant to Rule 39.04. Strictly speaking an affidavit may not be necessary but it may be convenient for the purpose of organizing and identifying the key portions of the evidence. Used in this way, the affidavit would be non contentious.
b) If it is necessary to rely on the information or belief of counsel with carriage of the file, it is preferable for counsel to swear the affidavit and have other counsel argue the motion. This approach will not be appropriate for highly contentious issues that may form part of the evidence at trial. If the evidence of counsel becomes necessary for trial on a contentious issue, it may be necessary for the client to retain another law firm.
c) Unless the evidence of a lawyer is being tendered as expert testimony on the motion, it is not appropriate for an affidavit to contain legal opinions or argument. Those should be reserved for the factum.
Time Limits in Examinations for Discovery
24Pursuant to Rule 31.05.1 of the Rules of Civil Procedure:
(1) No party shall, in conducting oral examinations for discovery, exceed a total of seven hours of examination, regardless of the number of parties or other persons to be examined, except with the consent of the parties or with leave of the court.
(2) In determining whether leave should be granted under subrule (1), the court shall consider,
(a) the amount of money in issue;
(b) the complexity of the issues of fact or law;
(c) the amount of time that ought reasonably to be required in the action for oral examinations;
(d) the financial position of each party;
(e) the conduct of any party, including a party’s unresponsiveness in any examinations for discovery held previously in the action, such as failure to answer questions on grounds other than privilege or the questions being obviously irrelevant, failure to provide complete answers to questions, or providing answers that are evasive, irrelevant, unresponsive or unduly lengthy;
(f) a party’s denial or refusal to admit anything that should have been admitted; and
(g) any other reason that should be considered in the interest of justice.
25In The Roman Catholic Episcopal Corporation of the City of Ottawa v. Houlahan, 2014 ONSC 5942, Master Roger noted that requests to extend the available time for discovery must be assessed on the specific facts of the case before the court (para. 10):
The amount of time that ought reasonably to be required in this action for the oral examinations has to be proportional to the importance and complexity of the issues and to the amounts involved, as required by rule 1.04(1.1)…When the rules were amended, imposing a time limit on oral examinations for discovery, it was understood that in some cases certain things might have to be done differently…
26Proportionality in the discovery process requires that the court also consider whether the approach being proposed by counsel satisfies the objective set out in the Rules of efficient, cost-effective proceedings. As noted by Master Roger in Houlahan (para. 10):
…Amongst other things, pleadings should be sufficiently particularized to allow focused examinations and examinations should be well prepared and conducted efficiently. An efficient and effective oral examination might not necessarily require every stone to be turned, quite the contrary.
27The impact of an extended discovery on the progress of the action is also a factor which ought to be considered by the court. In granting an extended discovery in Edwards v. McCarthy, 2012 ONSC 6833, Master Muir noted (para. 9):
Finally, the objective of achieving the just, expeditious and least expensive determination of the issues in this action would be furthered by allowing the additional discovery. A complete discovery of Mr. McCarthy will lead to economies at trial, a more meaningful mediation session and quite possibly promote an early resolution of this dispute.
28The defendants have also noted that Rule 1.04(1) directs the court to favour brevity in conducting discoveries. This rule provides that the Rules of Civil Procedure, “shall be liberally construed to secure the just, most expeditious and least expensive determination of every civil proceeding on its merits.” This is, however, subject to Rule 1.04(1.1) which requires the court to, “make orders and give directions that are proportionate to the importance and complexity of the issues, and to the amount involved, in the proceeding.”
29The Rules provide a mechanism whereby parties may agree upon the terms of examinations for discovery and reduce that agreement to writing in a Discovery Plan. Pursuant to Rule 29.1.03(3), a discovery plan is required to address the scope and procedure for discoveries, including, “the names of persons intended to be produced for oral examination for discovery under Rule 31 and information respecting the timing and length of the examinations”.
30The language of the Rules addressing Discovery Plans is mandatory language. Rule 29.1.03(1) provides that parties who intend to obtain evidence through an Examination for Discovery “shall” agree to a Discovery Plan. Rule 29.1.05(1) provides that the court, “may refuse to grant any relief or to award any costs if the parties have failed to agree to or update a discovery plan in accordance with this Rule.”
31In the absence of a Discovery Plan, on a motion seeking discovery-related relief, the court should consider the conduct of both parties in contributing to the circumstances giving rise to the motion (Guest v. Hirst, 2012 ONSC 86, para. 20; Ornstein v. Starr, 2011 ONSC 4220, para. 30).
Analysis
Should the Affidavit of Sarah E. Russell on behalf of the Plaintiff, sworn on March 26, 2021, be struck, or be given little weight?
32In my view, there is nothing inappropriate about Ms. Russell’s affidavit. Much of the information in the affidavit was uncontroversial and could be properly gleaned from a review of the file. Information which was within the direct knowledge of Mr. Connolly and obtained from him was identified in the affidavit. To the extent that there were factual disputes between the evidence in Ms. Russell’s affidavit and the evidence in Mr. Kitigawa’s affidavit, there was documentary evidence which the court was able to review to resolve those disputes.
33Unlike many of the cases relied upon by the defendant Co-Operators in argument, this was not a summary judgment motion in which determinations were being made which impacted the substantive rights of the parties. This motion addressed an issue of procedure. Even if Mr. Connolly had personally sworn an affidavit, there was no suggestion in Mr. Kitigawa’s affidavit or in argument that the defendant Co-Operators would have cross-examined Mr. Connolly on his affidavit. In my view, such a cross-examination would have been unnecessary.
34The request that Ms. Russell’s affidavit be struck or be given reduced weight is denied.
Should the Plaintiff be granted leave to exceed the time permitted for its Examination for Discovery of the Defendant Co-Operators by a further two hours?
Absence of agreement regarding the length of examinations
35It is clear from the record that the parties had no advance discussions regarding the length of the parties’ oral examinations.
36Ms. Russell indicates in her affidavit that defence counsel did not advise Mr. Connolly in advance of examinations of their intention to impose a time limit on the examinations of the defence representatives. This suggests that they had an obligation to do so. They did not.
37Rule 31.05.1(1) provides:
No party shall, in conducting oral examinations for discovery, exceed a total of seven hours of examination, regardless of the number of parties or other persons to be examined, except with the consent of the parties or with leave of the court.
38The language of Rule 31.05.1(1) is mandatory. It is also unambiguous – an extension of time is only available on consent or with leave. This places on the onus on the party seeking the extension to either obtain the consent of the opposing parties or, failing consent, to seek leave of the court.
39While there may be cases in which the need for an extension will only become apparent after examinations have commenced, this was not one of those cases. Three defence representatives were being produced, and two days were scheduled for defence discoveries. It was obvious that the examinations of the defendants were going to exceed seven hours.
40The plaintiff submits that, because it was obvious that the defendants’ examinations were going to extend beyond seven hours, they should have raised their objections when examinations were being scheduled. While I agree that this would have been the preferred approach from the perspective of civility, and I question the litigation tactics of raising this objection for the first time when the time limit was on the brink of expiring, this does not shift the onus to the defendants.
41When it became apparent during discovery planning that examinations were going to extend beyond the mandatory time limit, it was incumbent upon plaintiff’s counsel to confirm that he had the consent of the defendants to an extension, to confirm the length of that extension, and to confirm that consent in writing in the Discovery Plan. The failure to do so was a misstep by plaintiff’s counsel. Even if the failure to object were viewed as a form of acquiescence, it was presumptuous for plaintiff’s counsel to assume that a limitless extension of time would be granted.
42To his credit, Mr. Kitigawa ultimately agreed to an extension of time, and confirmed the extension to which he was prepared to consent in writing. While Mr. Connolly did not explicitly accept Mr. Kitigawa’s terms, he did proceed with the examination of the Co-Operators representative, Rebecca McGillivray.
43Co-Operators argues that Mr. Connolly’s decision to proceed with the examination constituted an acceptance of its offer to resolve the issue of examination time limits, and that the plaintiff should be bound by that acceptance. I disagree.
44The defendant’s terms were not presented as a formal offer to settle the time limits issue. Proceeding with the examination was, at best, a passive acquiescence to the defendant’s terms rather than a formal acceptance of an offer which would thereafter preclude the plaintiff from seeking relief. While the plaintiff’s acquiescence is a factor which should be considered by the court in assessing whether to grant an extension, it is not determinative of the issue.
Factors in Rule 31.05.1(2)
45That leaves the court to consider the factors set out in Rule 31.05.1(2).
46In my view, neither the amount of money in issue nor the financial position of the parties are determinative of this motion.
47The plaintiff asserts that it is seeking damages of $2.6 million dollars, however it is clear that the defendant has acknowledged that some funds are owing. In other words, the amount at issue is less, and may in fact be substantially less, than $2.6 million.
48The plaintiff is a farming business and the defendants are an insurance company and an insurance broker. While I have no doubt that there is a large disparity in their relative financial positions, I note that the defendant Co-Operators’ efforts to advance what it contends is owing have been rebuffed by the plaintiff with no apparent effort to accept those funds conditionally. This leads me to believe that the financial disparity is not a significant disadvantage to the plaintiff in this proceeding.
49The determinative factors for the purpose of this motion are: (1) the complexity of the issues of fact or law; (2) the amount of time that ought reasonably to be required for oral examinations; and (3) the conduct of the parties. I will consider each in turn.
(1) Complexity of the Issues of Fact or Law
50The pleadings identify issues in dispute including the following:
a. Whether the plaintiff’s farm property was underinsured because of negligence or breaches of contract by the defendants;
b. If the farm property was underinsured, what was the amount of insurance coverage that should have been extended to the plaintiff;
c. If the farm property was underinsured, what amount of insurance coverage would have been available to the plaintiff through the defendants, on what terms, and at what cost;
d. Whether the defendants misrepresented (negligently or otherwise) the status and the terms of the plaintiff’s insurance coverage to the plaintiff and its lenders, both before and after the plaintiff’s loss;
e. Whether the defendant Co-Operators acted negligently, in breach of its contractual obligations, and/or in bad faith in adjusting the Plaintiff’s claim for loss;
f. The assessment of the plaintiff’s damages; and,
g. Whether the facts and circumstances of the case give rise to punitive damages.
51The fire loss giving rise to the claim occurred on April 24, 2019. The business relationship between the plaintiff and the defendants commenced on May 1, 2002 and spanned almost seventeen years.
52In my view, the issues in dispute in this matter are not significantly complex for counsel experienced in litigating insurance disputes, as Mr. Connolly is. There are, however, multiple lines of inquiry which must be pursued addressing several aspects of the parties’ business relationship, both before and after the loss. Given the crossclaims, there would also be unavoidable overlap in the questioning of the defendant Co-Operators and the defendant Palmerio regarding the investigation and assessment of the plaintiff’s required insurance coverage, the underwriting of its policy, and the communication between the defendants regarding these issues.
53Given the length of the parties’ business relationship and the range of issues in dispute, it is my view that it would have been challenging for any counsel to complete examinations of three defendants within seven hours. This factor supports an extension of the available time for discoveries.
(2) Amount of Time Reasonably Required
54It is interesting to note that each of the defendants would have had seven hours available to them to examine the plaintiff. This would have resulted in the defendants having at least fourteen and as many as twenty-eight hours to examine the plaintiff, while the plaintiff only had seven hours to examine four defendants. One has to wonder whether the absurdity of such a result was ever considered when the rule was drafted; regardless, this is how the rule operates in practice and this is how it must be applied absent consent or leave.
55The record before me notes that ten hours and eighteen minutes have been spent to date on the plaintiff’s examinations. This time has been allocated as follows:
a. 3 hours and 44 minutes for Greg McAuley’s examination;
b. 4 hours and 42 minutes for John Palmerio’s examination;
c. 2 hours and 2 minutes for Rebecca McGillivray’s examination.
56In her affidavit, Ms. Russell identifies the following issues which prolonged the plaintiff’s examinations:
a. With respect to the examination of John Palmerio, his affidavit of documents did not distinguish between documents in the possession of Mr. Palmerio prior to the litigation and documents provided to him by Co-Operators following the commencement of the litigation. A significant portion of questions 91 to 270 were spent addressing this issue.
b. With respect to the examination of Rebecca McGillivray, she did not conduct a search of records in the possession of Co-Operators in order to produce relevant documents in advance of the examination. Ms. Russell alleges that Ms. McGillivray also failed to speak to people employed by Co-Operators to obtain information about the issues in dispute.
57With respect to the examination of John Palmerio, I have reviewed the transcript of his examination and disagree with Ms. Russell’s characterization of the questions regarding his affidavit of documents. While there were a few questions regarding the origin of the documents, it appeared to me that those questions consumed less than five minutes of time and that the inquiry was ultimately (and appropriately) addressed as an undertaking. It was clear from the questions asked that Mr. Connolly knew that there was an issue regarding the origin of the documents. If he was of the view that he required information in advance of examinations, he could have requested a further and better affidavit of documents from the defendants. His failure to do so is not the fault of the defendants.
58With respect to the examination of Rebecca McGillivray, I have reviewed the transcript of her examination and, while I agree that Ms. McGillivray did not conduct a search of the records in the possession of Co-Operators and that she did not speak to people employed by Co-Operators in preparation for her examination, I disagree that this lengthened her examination.
59Ms. McGillivray appears to have been produced because of her specific experience in farm policy underwriting for Co-Operators. She was best able to provide information regarding the company’s policies, guidelines, procedures, and expectations regarding the underwriting of farm policies; all this information is relevant to the issue of liability.
60It would have been obvious from a review of the documentary disclosure that Ms. McGillivray was not intimately acquainted with the plaintiff’s file. She was not directly involved in underwriting the plaintiff’s policy, and she had limited involvement in the adjustment of the plaintiff’s claim.
61With respect to the adjustment of the claim, that was Greg McAuley’s role. He was named as a defendant and he was examined. It was unnecessary for Ms. McGillivray to inform herself regarding this issue and it would have been a duplication to examine her about it.
62If Mr. Connolly wanted to examine a representative on behalf of Co-Operators who had specifically serviced the plaintiff’s policy at the underwriting stage, it was his obligation to request such a representative. Given the period over which the Co-Operators insured the plaintiff’s farm, however, it is likely that no one person within the company would have had personal knowledge regarding every interaction involving the policy’s underwriting.
63In my view, producing Ms. McGillivray was reasonable and appropriate. Specific information regarding the plaintiff’s policy could be pursued through documentary discovery, undertakings given by Ms. McGillivray to obtain documents and request information from within Co-Operators, and the examination of John Palmerio as the plaintiff’s broker. The plaintiff was also not precluded from bringing a motion pursuant to Rules 31.03(2)(b) or 31.10 to examine other individuals having knowledge of the underwriting of the plaintiff’s specific policy; those individuals could have been identified through Ms. McGillivray’s discovery.
64It is also my view that Ms. McGillivray was appropriately prepared for her examination. It was clear that she had reviewed the affidavit of documents. She answered the questions within her knowledge and Mr. Kitgawa was reasonable in providing undertakings to respond to those questions not within her knowledge. There were no unreasonable interruptions or objections which interfered with Ms. McGillivray’s examination or contributed to the failure to complete it within the two hours allotted.
65The principal reason that the examination was not completed was the volume of information and issues which were required to be addressed. One could argue that the examination could have been conducted more economically, however, as noted by Master Muir in Edwards v. McCarthy, 2012 ONSC 6833 (para. 7):
…It is true that the examination of Mr. McCarthy probably could have been conducted more efficiently but counsel should not be held to a standard of perfection when conducting a discovery. There is certainly no evidence of improper questioning on the part of counsel for the plaintiff that led to any significant wasted time.
66In my view, given the breadth of the issues that needed to be covered in the defendants’ examinations, it would not have been unreasonable to expect that three to four hours would have been required for each examination. This factor also supports an extension of the available time for discoveries.
(3) Conduct of the Parties
67Neither party to this motion is without fault. Both have contributed to the circumstances which bring this matter before the court.
68The parties started out well by conducting an initial meeting to engage in discovery planning. Mr. Connolly prepared and circulated a draft Discovery Plan (the “Discovery Plan”). As noted, it addressed several issues, including the parties’ pleadings, documentary discovery, the exchange of affidavits of documents, the conduct of oral examinations, and the scheduling of a mediation.
69From there, for reasons which are incomprehensible to me, things went downhill.
70Ms. Russell states in her affidavit that no issue was raised by Mr. Kitigawa respecting any matter in the Discovery Plan. Mr. Kitigawa states in his affidavit that there was an objection to the Discovery Plan, and that it was expected that an amended Discovery Plan would be circulated. Both statements are somewhat misleading.
71In his email correspondence of December 1, 2020 responding to the Discovery Plan, Mr. Clements raised a question about the “Pleadings” section of the Discovery Plan. No amendment was requested, but rather a clarification of Mr. Connolly’s position regarding the consequence of failing to serve and file a statement of defence to crossclaim. Mr. Kitigawa similarly did not request an amendment, but rather echoed Mr. Clements’ request for clarification.
72Mr. Connolly did not respond or take any further action following the email correspondence of December 1, 2020. While it is unfortunate that he did not respond, in my view his failure to do so is of little relevance to the motion before me. This motion pertains to the parties’ oral examinations – no request was made by either defence counsel to amend that aspect of the Discovery Plan, either or December 1, 2020 or at any other time leading up to January 13, 2021.
73When reviewing the Discovery Plan, what is relevant to me for the purpose of this motion is the following:
a. Mr. Connolly circulated the Discovery Plan on November 23, 2020 and requested that counsel for the Defendants sign and return it if it met with their approval. The Discovery Plan was never signed and returned by defence counsel, and their failure to do so was not pursued by Mr. Connolly.
b. The Discovery Plan identified Carolyn Newlands as the representative to be produced on behalf of The Co-Operators. Mr. Kitigawa did not object to this aspect of the Discovery Plan.
c. Although the Discovery Plan stipulated that oral examinations were to be conducted on January 13, 14 and 15, 2021, it was silent as to the length of each party’s time to conduct their examination(s).
d. The Discovery Plan provided for a meeting between counsel on December 18, 2020 to continue discovery planning. There is no evidence before me confirming whether that meeting took place or, if it did not take place, explaining why it did not proceed.
e. The oral examinations on January 13, 2021, January 14, 2021, January 15, 2021, and February 5, 2021 proceeded in the absence of a signed Discovery Plan or alternatively a Discovery Plan to which all counsel explicitly agreed.
74The Discovery Plan was a missed opportunity to establish the parameters for the parties’ oral examinations. On the record before me, it is my view that the failure to formally complete the Discovery Plan was the fault of the plaintiff. Having said that, in the face of the defendants’ failure to object to the Discovery Plan as it pertained to documentary discovery and oral examinations, it was not unreasonable for Mr. Connolly to proceed on the basis that Mr. Clements and Mr. Kitigawa were acquiescing to those terms of the Discovery Plan.
75As noted, Mr. Connolly identified Ms. Newlands as the representative to be produced on behalf of the Co-Operators and Mr. Kitigawa did not object to this aspect of the Discovery Plan.
76Mr. Kitigawa addressed this in his affidavit by stating that he thought that Ms. Newlands “might” be a witness and that he did “mention” her name to the parties. He went on to state that he did not “commit” to producing Ms. Newlands as a witness.
77There were a couple of “red flags” in the evidence suggesting that there may have been doubt about whether Ms. Newlands was going to be produced on behalf of Co-Operators. In his email correspondence of December 1, 2020, Mr. Kitigawa stated, “As for my witness, due to personal issues, Greg has been out of the office but I expect to speak with him next week and will report back”; there was no reference to Ms. Newlands or another Co-Operators representative, and Mr. Connolly did not seek clarification of this omission. I also noted that Ms. Newlands was omitted from the notice of examination served by the plaintiff on January 12, 2021, although the notice did request the attendance of both Greg McAuley and a representative from Co-Operators.
78Notwithstanding these “red flags”, it is my view that it was ultimately Mr. Kitigawa’s obligation to explicitly confirm that he did not intend to produce Ms. Newlands, or another representative on behalf of Co-Operators, well in advance of the morning of January 13th.
79By his own evidence, Mr. Kitigawa had put Ms. Newlands’ name forward (even if only tentatively) and it was clear from the Discovery Plan and the notice of examination that Mr. Connolly was operating under the belief that she (or a representative of Co-Operators) was going to be produced.
80Mr. Kitigawa indicates in his affidavit that he decided not to produce Ms. Newlands because she, like Mr. McAuley, was an adjuster. That was not Mr. Kitigawa’s decision to make. If he was of the view that Ms. Newlands was an inappropriate representative on behalf of Co-Operators, it was his obligation to advise Mr. Connolly of his position well in advance of examinations and to give Mr. Connolly the opportunity either to identify another representative or to pursue his remedies if he disagreed.
81Leaving Mr. Connolly to operate under the belief that a separate Co-Operators representative was going to be produced and then advising him on the first morning of a 3-day discovery that only Mr. McAuley was going to be produced was a pointed litigation tactic.
82Mr. Kitigawa suggests in his affidavit that the plaintiff’s objection to this change in the examination schedule is a “diversionary tactic” as the plaintiff ultimately examined a representative on behalf of Co-Operators. I disagree. Mr. Connolly would have prepared to examine Ms. Newlands first on January 13th, and he would have been expecting to examine Mr. McAuley following her and perhaps even the following day. There can be little doubt that this would have undermined any plan that he prepared to conduct his examinations.
83While all counsel must accept some responsibility for the events leading to this motion, it is my view that the conduct of defence counsel was more troublesome and supports an extension of the available time for discoveries. While the conduct of plaintiff’s counsel can best be described as errors of omission, the conduct of defence counsel was intentional and its adverse impact on the Plaintiff’s examinations would have been foreseeable to any experienced litigation counsel. This conduct cannot be condoned or rewarded at the expense of the plaintiff.
Appropriate relief in the circumstances
84It is not clear to me from the record whether Mr. Connolly expected that he could complete Ms. McGillivray’s examination within two hours or whether he knew in advance that two hours was going to be insufficient but proceeded anyway with the expectation that once underway the defendant would permit it to be completed. Given the indignation that Mr. Connolly expressed when Mr. Kitigawa ended the examination after two hours, I suspect that it was the latter.
85Counsel for Co-Operators noted in his submissions that the plaintiff has not provided evidence setting out why it requires additional time for Ms. McGillivray’s examination. This is a fair observation. In her affidavit, Ms. Russell states:
I am advised by Mr. Connolly, and verily believe to be true, that additional questions and answers are required in order to obtain admissions that challenge the Defendants' blanket denials, narrow the issues for trial, and to fully know the evidence in the possession of the Defendants over a period of seventeen (17) years of providing insurance coverage and being paid and collecting commission fees from the Plaintiff.
86The only evidence about the subject-matter requiring further questioning is included in the transcript of Ms. McGillivray’s examination. At the end of the transcript, at question 242, Mr. Connolly noted the following:
Well, I'd just like to put on the Record that I have many more questions for you, Ms. McGillivray, with respect to the calculations made by your financial advisors in determining the limits of coverage. Looking through my notes, I would say that I have at least another hour and a half of questioning for you.
87As previously noted, the examination of Ms. McGillivray arguably could have been conducted with more attention to the limited available time, however it is my view that the principal reason it was not completed was the scope of the questioning that would have been required of her. The underwriting practices and procedures of Co-Operators is a cornerstone issue in this litigation. Ms. McGillivray’s examination is essential to the plaintiff’s understanding of the strength of its case against Co-Operators, as well as its preparation for trial. The plaintiff will be prejudiced in the absence of a fulsome examination of this witness.
88Although the plaintiff’s evidence establishing the further discovery it requires is less than ideal, in the transcript of Ms. McGillivray’s discovery, Mr. Connolly noted that he required, “at least another hour and a half” to conduct her discovery. I find that this is sufficient evidence to support an extension of time for 1.5 hours.
89Although I have granted the plaintiff’s request for an extension, I am exercising my discretion pursuant to Rule 29.1.05(1) not to award costs. While neither counsel has come to court with clean hands, I find that this motion could have been avoided altogether had plaintiff’s counsel addressed the time limits of discovery at the planning stage and reduced any agreement to writing in his Discovery Plan. I find that counsel’s failure to do so disentitles the plaintiff to costs notwithstanding the conduct of defence counsel and result of the motion.
Disposition
90For the reasons given, I make the following orders:
a. The defendant’s request to strike the affidavit of Sarah E. Russell, sworn March 26, 2021, or to give this affidavit less weight, is denied.
b. The plaintiff is granted a further one and one-half hours to complete the examination for discovery of Rebecca McGillivray, with the examination to be conducted on a date and time to be agreed between the parties or, failing agreement, in accordance with a notice of examination to be served by the plaintiff.
c. There shall be no costs of this motion.
K.E. Cullin, J.
Date: October 19, 2021