Court File and Parties

COURT FILE NO.: CV-19-01111-0000 DATE: 2021-11-08

SUPERIOR COURT OF JUSTICE – ONTARIO 7755 Hurontario Street, Brampton ON L6W 4T6

RE: Ishver Lad et al., plaintiff AND: Manny Marcos et al., defendant

BEFORE: Justice Ivan Bloom

COUNSEL: A. Speigel, for the plaintiffs R. Benjamen as agent for G. Hemsworth, for the defendants

HEARD: November 8, 2021

ENDORSEMENT

[1] The Plaintiffs have brought a motion for exclusion of each of the Defendants from presence at examination for discovery of every other Defendant and for related relief. All Defendants are represented by Ms. Benjamen before me, except for the company which has been noted in default.

[2] The Plaintiffs in the present action are making claims against the Defendants in order to enforce judgment for $71,177 against the company by Justice Seppi of this court for deficient work; and by Justice Seppi against Manny and the company for $578,793.00 in costs; and against Manny for $17,756.00 in costs on an unsuccessful appeal of the costs award by Justice Seppi. The present action alleges that the Defendants have engaged in fraudulent acts, including fraudulent transfers of funds and interests in land, with the effect of thwarting collection of the outstanding 3 debts.

[3] The Plaintiffs seek specifically orders excluding the Defendants from the examinations for discovery of one another, preventing their counsel from informing their clients of the questions and answers asked of other Defendants before their own examinations for discovery, requiring the Defendants to attend for the examinations, if they are virtual, at a reporting facility not a lawyer’s office, preventing the Defendants or their counsel from taking audio or video recordings of the examinations, preventing the Defendants and their counsel from providing transcripts of the examinations to other Defendants before the examinations are completed and requiring the examinations for discovery in the action to be completed by the end of February of 2022. The Plaintiffs also ask that the completion of an examination for purposes of the relief they seek be construed as the completion of answering of undertakings.

[4] The governing principles relating to this motion are set out by the Divisional Court in Lazar v. TD General Insurance Co., 2017 ONSC 1242.

[5] The Plaintiffs argue that the evidence before me demonstrates that the Defendants have engaged in fraudulent and improper conduct which justifies the orders they seek to prevent collusion of the Defendants in their answers on examinations for discovery. The Plaintiffs underline the importance of credibility and reliability as issues in the present action.

[6] The Defendants argue that the Plaintiffs have not discharged their onus to satisfy the court that the orders sought are necessary to meet the ends of justice, particularly because of prejudice to the Defendants in working with their lawyers under the orders sought and in view of the lack of evidence of fraud against any Defendants other than Manny and the company. The Defendants also argue that because the discovery plan in the case at bar as ordered by the court does not contemplate the orders sought and because the Plaintiffs had opportunities to include such provisions in the plan, I should not make the orders sought.

[7] Applying the Lazar principles to the evidence before me, I find that the Plaintiffs are entitled to the relief they seek, and I so order.

[8] I have concluded that the orders sought are necessary to attempt to ensure the integrity of the discovery process. Otherwise there is a real risk that collusion of the Defendants will negate the truth-finding function of the examinations for discovery of the Defendants.

[9] The evidence of deceit and other improper conduct by each of the Defendants is found in the record of the action which underlies the present collection action, in the evidence supporting the present action, in the conduct of the Defendants on motions and appellate proceedings in the present action, and in the conduct of the Defendants in tax matters. The Defendants argue that there is no direct evidence of fraud against some of the Defendants, including Catarina and Arlete. However, I accept the Plaintiffs’ argument that the evidence of transfers of funds and interests in land among the Defendants links them all with sufficient evidentiary strength to fraudulent and improper conduct of one another to justify the orders I am making to avoid collusion.

[10] I shall now address the Defendants’ argument based on the discovery plan.

[11] I accept that Rule 29.1.01 applies to this matter, because of the court-ordered discovery plan.

[12] However, that plan in section I is consistent with the relief that the Plaintiffs have sought on the motion before me. Moreover, I do not see sufficient prejudice to the Defendants flowing from the Plaintiffs’ not moving earlier for that relief when the discovery plan was being addressed, to overcome the needs of justice which now require that relief.

[13] The Plaintiffs seek costs of $18,446.94 on a substantial indemnity basis and alternatively $12,417.96 on a partial indemnity basis. The Defendants argue that the Plaintiffs ought not to be awarded substantial indemnity costs in view of their earlier failures to raise the issues subject of my order during the working out of the discovery plan.

[14] In my view the Defendants’ position has merit on the costs issue. Given the Plaintiffs’ success I award them costs of $12,417.96 inclusive of fees, disbursements, and applicable taxes payable by the Defendants jointly and severally within 30 days.

_________________________ Justice I. Bloom

Released: November 08, 2021