COURT FILE NO.: CV-20-627
DATE: 2022-07-26
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Nieuwland Feed & Supply Limited
Plaintiff
– and –
Christopher Ewing
Defendant
R. Scriven, for the Plaintiff
A. Wilford, for the Defendant
HEARD: May 18, 2022, via Zoom
the honourable mister justice M.j. Valente
reasons for decision
Introduction
[1] This is a motion for summary judgment brought by the plaintiff, Nieuwland Feed & Supply Limited, against the defendant, Christopher Ewing, for judgment in the principal amount of $237,271.33 on an overdue account plus interest.
[2] The plaintiff is a wholesale supplier of animal feed, fertilizer, and farming supplies.
[3] The defendant is a dairy goat farmer.
[4] In or about November 2012 the plaintiff and the defendant entered into an agreement whereby the defendant would purchase feed and other faming supplies from the plaintiff on a rolling credit basis.
[5] The defendant continued to order product from the plaintiff and the plaintiff supplied product until in or about August 2019 when their commercial relationship came to an end. In total, 87 shipments were provided by the plaintiff to the defendant.
[6] All of the plaintiff’s invoices to the defendant for the period of December 20, 2012, to August 7, 2019, contain the following term:
TERMS: Service charge of 2 ½ % per month (30 % per annum) on overdue accounts due the 20th of the following month. All goods shipped at buyer’s risk. Shortages or damaged goods must be reported within 48 hours or no allowance will be made. Trucker must certify shortage or damage.
[7] The last payment made by the defendant to the plaintiff was on August 6, 2019, in the amount of $205.16.
Position of the Parties
(A) The Defendant
[8] The defendant disputes the amount owing. He asserts he did not receive all of the weigh slips and invoices upon delivery of the feed, and therefore, questions the amounts due and owing.
[9] The defendant also asserts that the plaintiff represented to him that its goat feed was of the highest quality, and it would produce “the best margin [of production] over feed cost” but in fact, the defendant’s goat herd became sickly, developed a variety of health problems and some died after consuming the plaintiff’s feed. There was also a corresponding reduction in the herd’s milk production after November 2012.
[10] The defendant therefore submits any contractual relationship it had with the plaintiff is void for misrepresentation and otherwise he owes nothing to the plaintiff by reason that its product was defective for its intended purpose.
[11] The defendant also submits that it has a valid set-off claim for its loss of profits during its seven-year relationship with the plaintiff that exceeds the amount stipulated in the statement of claim.
(B) The Plaintiff
[12] The plaintiff’s position is simply that it has proved the amount alleged to be due and owing, and for his part, the defendant has not offered any evidence to support his defences. In short, the defendant has not raised any issue requiring a trial.
Legal Principles
[13] Rule 20.01 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 permits a party to move for summary judgment. Rule 20.04 provides as follows:
20.04 (2) The court shall grant summary judgment if,
(a) the court is satisfied that there is no genuine issue requiring a trial with respect to a claim or defence; or
(b) the parties agree to have all or part of the claim determined by a summary judgment and the court is satisfied that it is appropriate to grant summary judgment.
(2.1) In determining under clause (2) (a) whether there is a genuine issue requiring a trial, the court shall consider the evidence submitted by the parties and, if the determination is being made by a judge, the judge may exercise any of the following powers for the purpose, unless it is in the interest of justice for such powers to be exercised only at a trial:
Weighing the evidence.
Evaluating the credibility of a deponent.
Drawing any reasonable inference form the evidence.
[14] The relevant principles pertaining to summary judgment are now well known as a result of Hryniak v. Mauldin, 2014 SCC 7.
[15] In Hryniak, Karakatsanis, J. addressed what she described as a “necessary culture shift” regarding to access for justice:
[28] This requires a shift in culture. The principal goal remains the same: a fair process that results in a just adjudication of disputes. A fair and just process must permit a judge to find the facts necessary to resolve the dispute and to apply the relevant legal principles to the facts as found. However, that process is illusory unless it is also accessible – proportionate, timely and affordable. The proportionality principle means that the best forum for resolving a dispute is not always that with the most painstaking procedure.
[16] When is there no genuine issue requiring a trial? Karakatsanis, J. addressed this question in great detail, in particular at paragraphs 49, 50, 66 and 67, as follows:
[49] There will be no genuine issue requiring a trial when the judge is able to reach a fair and just determination on the merits on a motion for summary judgment. This will be the case when the process (1) allows the judge to make the necessary findings of fact, (2) allows the judge to apply the law to the facts, and (3) is a proportionate, more expeditious and less expensive means to achieve a just result.
[50] These principles are interconnected and all speak to whether summary judgment will provide a fair and just adjudication. When a summary judgment motion allows the judge to find the necessary facts and resolve the dispute, proceeding to trial would generally not be proportionate, timely or cost effective. Similarly, a process that does not give a judge confidence in her conclusions can never be the proportionate way to resolve a dispute. It bears reiterating that the standard for fairness is not whether the procedure is as exhaustive as a trial, but whether it gives the judge confidence that she can find the necessary facts and apply the relevant legal principles so as to resolve the dispute.
[66] On a motion for summary judgment under Rule 20.04, the judge should first determine if there is a genuine issue requiring trial based only on the evidence before her without using the new fact-finding powers. There will be no genuine issue requiring a trial if the summary judgment process provides her with the evidence required to fairly and justly adjudicate the dispute and is a timely, affordable and proportionate procedure, under Rule 20.04(2)(a). If there appears to be a genuine issue requiring a trial, she should then determine if the need for a trial can be avoided by using the new powers under Rules 20.04(2.1) and (2.2). She may, at her discretion, use those powers, provided that their use is not against the interest of justice. Their use will not be against the interest of justice if they will lead to a fair and just result and will serve the goals of timeliness, affordability and proportionality in light of the litigation as a whole.
[67] Inquiring first as to whether the use of the powers under Rule 20.04(2.1) will allow the dispute to be resolved by way of summary judgment, before asking whether the interest of justice requires that those powers be exercised only at trial, emphasizes that these powers are presumptively available, rather than exceptional, in line with the goal of proportionate, cost-effective and timely dispute resolution. As well, by first determining the consequences of using the new powers, the benefit of their use is clearer. This well assist in determining whether it is in the interest of justice that they be exercised only at trial.
[17] In paragraph 66 above, Karakatsanis J. identifies a two-step process:
i) is there a genuine issue requiring a trial, based upon the evidence presented on the motion;
ii) if there is, can a trial be avoided by using the expanded powers in Rule 20.04(2.1) and (2.2).
See as well: Trotter v. Trotter, 2014 ONCA 841, at para.s 72 and 75.
[18] Despite this “culture shift”, the evidentiary requirements in Rule 20.02 have not changed. Parties must “put their best foot forward”. They are prohibited from saying “more and better evidence will (or may) be available at trial.” The court is entitled to assume the record contains all of the evidence the parties would present at trial. See: Pizza Pizza Ltd. v. Gillespie (1990), 1990 CanLII 4023 (ON SC), 75 O.R. (2d) 225 (Gen. Div.); Dawson v. Rexcraft Storage & Warehouse Inc. (1998), 1998 CanLII 4831 (ON CA), 164 D.L.R. (4th) 257 (Ont. C.A.); and Simcoe Muskoka Child, Youth and Family Service v. L.V., 2019 ONSC 1208 (Div. Court).
Analysis
[18] With these legal principles in mind, I will examine the defences raised by the defendant. As a preliminary comment, I note that the defendant was both examined for discovery and cross examined on his affidavit sworn October 28, 2021, (the ‘October Affidavit’).
[19] The defendant also delivered an affidavit sworn May 12, 2022, (the ’May Affidavit’) and subsequent to his cross-examination on October 28, 2021. Counsel for the plaintiff did not object to the defendant’s May Affidavit being considered by me in the determination of this motion for summary judgment notwithstanding the primae facie prohibition imposed by the Rules of Civil Procedure.
[20] Finally, defence counsel agreed that answers given on the defendant’s examination for discovery are to be considered as evidence on this motion.
(a) The Principal Amount and Rate of Interest Claimed by the Plaintiff
[21] The plaintiff has tendered in evidence all of the 87 invoices upon which it relies to prove the debt is due and owing along with a reconciliation of all debits and credits. Based on the plaintiff’s accounting documentation, I am satisfied that the principal sum of $237,271.53 is accurately calculated as owing.
[22] Whereas in his examination for discovery, the defendant confirmed the principal amount as claimed is due and owing, on his subsequent cross-examination he testified that a lesser amount is due. The defendant attests in his October Affidavit that he is unable to stipulate what lesser principal amount may be owing because he did not receive all of the weigh slips, and therefore, cannot confirm what amount was actually delivered.
[23] Apart form the implied admission that some weigh slips were indeed received and the defendant’s explicit admission that some invoices were also received by him, all of which specify the quantity of feed shipped as well as that on “numerous occasions” the defendant contacted the plaintiff’s representative to confirm load weights, I cannot accept that if the defendant had any concerns with the quantity shipped during the parties’ 7 year relationship, he would not have raised the issue with the plaintiff. Furthermore, on the defendant’s own admission, at no time did he provide notice of delivery shortages. I therefore find the quantity of product claimed to be shipped by the plaintiff was indeed received by the defendant and is due and owing.
[24] As previously stated in this Decision, each of the plaintiff’s invoices prescribe an interest rate of 2.5 % per month which rate is expressed as an annual rate of 30%.
[25] Defence counsel objects to the claimed interest rate on that basis that the monthly rate of 2.5 % is not accurately expressed in terms of an annual rate equivalent. He submits that 2.5 % per month is equal to an annual rate of 33.0 %, and not 30.0 %. On that basis the prescribed rate offends the provisions of section 4 of the Interest Act, R.S.C., 1985, c. 1-15, and therefore, the Interest Act rate of 5.0 % per annum, if any rate, should be imposed.
[26] In my view there would be merit to defence counsel’s argument if the plaintiff were claiming an interest rate of 2.5 % compounded monthly. In that event, and according to my calculations, the annual equivalent rate would be 34.46 %. However, the plaintiff is not claiming compound interest pursuant to the terms of sale; rather the claim is for simple interest. The simple interest annual equivalent calculation of 2.5 % per month is 30.0 % per annum.
[27] In addition, in his examination for discovery, the defendant acknowledged that interest was due and owing on any overdue accounts and in his subsequent cross-examination the defendant confirmed that during his long-standing commercial relationship with the plaintiff, he never disputed the rate charged.
[28] I therefore find that a simple interest rate of 30.0 % per annum is due on any principal amount owed to the plaintiff.
(b) The Plaintiff’s Representation
[29] The defendant submits that the plaintiff induced him to buy its product based on its representation that its feed would increase milk production, and therefore, his profit. He also asserts that at the end of the day, the feed failed to meet his reasonable expectations based on the plaintiff’s representations.
[30] As evidence of the plaintiff’s representation, the defendant states in his October Affidavit:
“The reason I chose Nieuwland feed was because they advised me that their fee program would produce the best margin other feed”
[31] Later in his May Affidavit, the defendant states:
“… they claimed their feed program was far superior to Floradale feed. Nieuwland provided margin over fed [sic] cost information showing that it was a more expensive feed with significantly higher production over conventional feeding programs”.
[32] Nowhere in the record does the defendant attest to who made the alleged representations to him on behalf of the plaintiff and nor does he provide any details of the circumstances in which the representations were made. Also curiously lacking in his evidence are any particulars of his challenging the plaintiff on its representations when he had concerns about the product’s failure as far back as 2012.
[33] Based on the bald statements of the defendant, I am not prepared to find that the alleged representations were made to the defendant to induce him to purchase the plaintiff’s feed, or for any reason. I rely on the powers afforded to me pursuant to Rule 20.04 (2.1) to determine that the defendant’s evidence is not credible on this issue.
[34] Even if I were to have found that the alleged representations were made, on the evidence before me I am not satisfied that the plaintiff’s feed is the cause of the defendant’s alleged below average milk production. My reasons for this determination are set out below.
(c) Poor Feed Quality
[35] Apart form the plaintiff’s alleged misrepresentations about its product, the defendant also asserts that the plaintiff’s feed was of such poor merchantable quality, he is not liable to pay the plaintiff any more than that which he has already paid.
[36] The defendant states that soon after he fed his herd the plaintiff’s feed, the milking does and doelings coats became “dull and ratty”, and they gained an excessive amount of weight. The weight gain caused breeding and kidding issues resulting in pregnancy toxemia. Pregnancy toxemia and chlamydiosis caused 34 of 75 milking does to become septic and die, including the defendant’s top producing goat. He also assets that the consumption of the plaintiff’s feed by the herd was coincidental with a dramatic increase in false pregnancies, aborted pregnancies, still births and a dramatic decrease in milk productivity.
[37] It is the defendant’s position that the plaintiff’s feed contains corn stover which is the root cause of his herd’s health issues and decrease in milk productivity.
[38] Based on the defendant’s visual inspection of the feed, he suspected it contained corn as early as 2012. Notwithstanding his suspicion and early concern, the defendant continued to purchase the plaintiff’s feed for 7 years without confirming its chemistry.
[39] There is no evidence before me of the feed’s ingredients.
[40] The defendant submits this court should draw an adverse inference from the plaintiff’s refusal to disclose the feed’s chemistry. Apart form the fact that Shur-Gain, and not the plaintiff, is the manufacturer of the feed and has a proprietary interest in the feed’s composition, the defendant never took any steps in the litigation to confirm his “suspicion” that the feed contained corn.
[41] Moreover, the defendant could have easily had a sample of the plaintiff’s fee tested to confirm its contents but for reasons unexplained, he failed to do so.
[42] Not only is there no reliable evidence to confirm corn as an ingredient in the feed, there is no expert evidence in the record connecting corn as a feed ingredient to the herd’s ill health and low milk production as described by the defendant.
[43] Furthermore, the defendant has offered no evidence to establish or even suggest that his herd’s health and milk production issues are caused by the plaintiff’s feed generally and regardless if it may contain corn.
[44] The one post-mortem report offered as evidence by the defendant is dated August 27, 2019, and is conducted by the University of Guelph Laboratory Services. The only references to feed in the post-mortem are the pathologist’s observation that the “abomasum was very distended with feed” and comment that “I am concerned there may be a problem with feeding too much volume resulting in Rumen-acidic pH, possible acidosis”.
[45] In my opinion, the post-mortem provides no basis for this Court to conclude that the plaintiff’s feed is the cause, or even a contributing factor, to the defendant’s goat herd’s unfortunate health problems.
[46] As sated by the Divisional Court in Simcoe Muskoka Child Youth and Family Services, this Court is entitled to assume that all available evidence has been put before it in some form. In other words, the defendant has an obligation on a motion for summary judgment to put his best foot forward and cannot rest on allegations that he hopes to prove later at trial. (see para. 11).
[47] In short, the defendant has failed to put his best foot forward.
[48] In dismissing the defendant’s defence that the plaintiff’s feed is of such poor quality that it was not fit for it intended purpose, I also rely on that defendant’s admission that a herd’s mortality and low milk production can result from a variety of issues. In particular, the defendant conceded on cross-examination that milk production can be negatively impacted by forages, weather, crowding, water quality, and herd management, as well as other factors.
[49] The defendant also acknowledged on cross-examination that the down turn in the diary goat industry had an impact on his ability to pay the debt owed to the plaintiff.
(d) The Defendant’s Set-Off Claim
[50] Because I have found that there is no evidence to support the defendant’s defence that the feed is of poor quality and that there is no causal connection between the plaintiff’s feed and the defendants alleged damages, I need not consider further, in my opinion, the defendants equitable set-off claim.
[51] However, had I connected the plaintiff’s feed to the defendant’s herd’s poor health and milk productivity issues, based on the record before me there is no evidence to assess the defendant’s losses. Not only has the defendant provided the Court with no financial information to determine his set-off claim, but the defendant himself is unable to provide any justification for his estimated losses of $100,000 for each of the years in which he purchased the plaintiff’s feed.
Disposition
[52] For the reasons stated above, I am of the view that the issues in dispute can be determined by reference to the record before me and the relevant legal principles. There is no genuine issue requiring a trial.
[53] Accordingly, the plaintiff is granted judgement in the principal amount of $237,271.33 plus pre-judgment interest calculated at the simple annual interest rate of 30.0 % to the date of release of this decision.
[54] I encourage the parties to agree on the issue of costs and provide me with a consent Judgment for my signature.
[55] If, however, the parties are unable to settle the issue of costs, then the plaintiff may make written submissions as to costs within 15 days of the release of these Reasons. The defendant will have 10 days after receipt of plaintiff’s submissions to respond and the plaintiff will have a further 5 days to reply. Each party’s initial written submissions shall not exceed three double-spaced pages, exclusive of offers to settle, cost outlines and authorities while the plaintiff’s reply submissions, if any, shall not exceed two double spaced pages. All costs submissions shall be forwarded to my attention by way of email to my judicial assistant, Kelly Flanders, at kelly.flanders@ontario.ca with a copy CC’d to Kitchener.SCJJA@ontario.ca. If no submissions are received within this timeframe, the parties will be deemed to have settled the issue of costs between themselves.
M.J. Valente, J.
Released: July 26, 2022
COURT FILE NO.: CV-20-627
DATE: 2022-07-26
ONTARIO
SUPERIOR COURT OF JUSTICE
Nieuwland Feed & Supply Limited
Plaintiff
– and –
Christopher Ewing
Defendant
REASONS FOR decision
M.J. Valente, J.
Released: July 26, 2022