Court File and Parties

Court File No.: CV-17-00583915-0000 Date: October 26, 2022 Superior Court of Justice - Ontario

Re: Yu Fang, Plaintiff And: Shane Anthony Fullwood and Courtney Brook Barr, Defendants

Before: Koehnen J.

Counsel: Nick Hamilton, Daniaal Sibtain for the Plaintiff Albert Wallrap, for the Defendant, Courtney Brook Barr Shane Anthony Fullwood, Self-Represented

Heard: October 21, 2022

Endorsement

[1] This is a motion by the defendants to set aside a default judgment issued against them in the amount of $124,474.66 plus costs in the amount of $8,022.23.

[2] Two issues arise with respect to the setting aside of the default judgment: whether the defendants were served with the statement of claim and whether the defendants were served with the motion to obtain default judgment.

[3] The plaintiff has filed an affidavit of service from a process server indicating that the defendant Courtney Barr was served at her personal residence. The defendant Shane Fullwood was served by leaving a copy of the statement of claim with Ms. Barr who, when she was served, was an adult member of Mr. Fullwood’s household. At the time, Ms. Barr and Mr. Fullwood were in a romantic relationship.

[4] Ms. Barr denies being served. She says she has no recollection of it. That said, she also volunteered that the week in which she was served was chaotic in that she and Mr. Fullwood were ending their relationship and moving out of their apartment into separate residences.

[5] I accept that Ms. Barr was validly served with the statement of claim. Mr. Fullwood does not, however, appear to have been served. This is implicit in Ms. Barr’s evidence to the effect that she does not recall being served and if she was served, that the envelope containing the statement of claim was lost in the upheaval of the end of the relationship and the move.

[6] The plaintiff noted the defendants in default shortly after the 30-day period to deliver a defence. The plaintiff did so without further notice or warning to the defendants.

[7] The plaintiff moved for default judgment approximately three and a half years later. The plaintiff says she had the defendants served with the motion for default judgment at their last known address. That was the same address as the one at which the statement of claim was served. Neither defendant lived at that address when the default judgment motion record was purportedly served on them. The motion record was served by courier and registered mail. There is no evidence in the record about what response the plaintiff received to her effort to serve the default judgment motion record.

[8] After obtaining default judgment, the plaintiff took steps to enforce it. In doing so she learned the true addresses of each of the defendants and took steps to enforce the judgment at each of those addresses. As a result of this, both defendants became aware of the default judgment and moved promptly to set aside. Given that there was a 3 ½ year delay between the noting in default and the motion for default judgment, the plaintiff could arguably have taken steps to determine whether the defendants continued to live in the same building that they lived in when the statement of claim was served on Ms. Barr. Finding a current address is usually a relatively low cost, low energy exercise. There is no evidence in the record that finding the defendants’ true addresses was costly or inconvenient.

[9] The fundamental issue on a motion to set aside default judgment is to determine whether the interests of justice warrant granting the order.[^1] In making this determination the court is to consider the following five factors:

(i) whether the motion was brought promptly after the defendant learned of the default judgment;

(ii) whether there is a plausible excuse or explanation for the defendant's default in complying with the Rules;

(iii) whether the facts establish that the defendant has an arguable defence on the merits;

(iv) the potential prejudice to the defendant if the motion is dismissed and the potential prejudice to the plaintiff if the motion is allowed; and

(v) the effect of any order the court might make on the overall integrity of the administration of justice.

[10] With respect to the first factor, it is agreed that the motion to set aside default judgment was brought promptly after the defendants learned of it.

[11] With respect to the second factor, there is a plausible excuse or explanation for the defendants’ failure to defend in a timely manner. The claim was served on Ms. Barr at a time when she says she was in the middle of the breakup of a long-term relationship and in the middle of a move. Mr. Fullwood appears not to have received a copy of the statement of claim at all. The plaintiff provided no forewarning of the intention to note the defendants in default and then remained quiet for approximately 3 ½ years.

[12] The third factor causes me the most difficulty. It requires me to consider whether the record discloses a reasonable defence on the merits. In my view, the record does not do so.

[13] The action arises out of a dispute between neighbours that escalated to an unfortunate degree. A video taken from an elevator camera recorded some of the incident.

[14] The plaintiff and the defendants lived on the same floor of an apartment building.[^2] Ms. Fan was in the elevator riding up to her floor. As she left the elevator, she brushed against Ms. Bar. This led to some sort of verbal exchange. The precise nature of the exchange is indiscernible from the video because it has no audio functionality. Whatever the nature of the exchange, it led Ms. Bar to leave the elevator and either video the plaintiff with her phone or pretend to do so. As Ms. Bar entered the elevator again, the plaintiff came back into the elevator. A further verbal exchange occurred that appears to have been heated. Immediately before the plaintiff left the elevator a second time, Ms. Barr says the plaintiff spat at her. This led Ms. Bar to leave the elevator and appear to push the plaintiff (although this is not entirely clear from the video). Ms. Bar then entered the elevator again. The video then shows an individual who appears to be Mr. Fullwood, approaching quickly from the opposite end of the hallway and the very beginnings of what look like a tackle on someone or something. The plaintiff says she was the one Mr. Fullwood tackled. The video stops at that point. The plaintiff says Mr. Fullwood and Ms. Barr held her down. In the course of the altercation the plaintiff says she sustained a fractured arm. She was treated in hospital for a fracture about 3 hours after the incident.

[15] The defence on the merits suggests that the plaintiff was the instigator of the assault and that the defendants were the victims. The evidence on the record before me does not make that out. While the cause of the very start of the incident is uncertain, the video appears to show Mr. Fullwood tackling the plaintiff after she had left the elevator and when Ms. Barr was back on the elevator and in no danger from the plaintiff.

[16] As tenuous as the defence may appear to me, had Mr. Fullwood been served with the statement of claim, he would have had the absolute right to defend in any way wished. In addition, there appears to be some ambiguity concerning the events. Mr. Fullwood agreed to a plea and a conditional discharge arising from them. The plaintiff was charged with assault and was acquitted. The acquittal was overturned on appeal and remitted to a new trial with which the Crown never proceeded.

[17] Mr. Fullwood has not formally brought a motion to set aside the default judgment. He is self represented and piggybacks on Ms. Barr’s motion. Mr. Fullwood did not make any submissions on the motion before me other than to say he wishes to have the default judgement set aside and wishes to defend the action.

[18] The fourth factor calls on the court to balance potential prejudice to the defendants if the motion is dismissed and the potential prejudice to the plaintiff if the motion to set aside is granted. This militates strongly in favour of setting aside default judgment. The prejudice to Mr. Fullwood is that he would be found liable for judgment without ever having received notice of the statement of claim. Ms. Barr is in a similar situation in that the circumstances of service on her would ordinarily lead to setting aside the noting in default. Those circumstances militate even more strongly in favour of setting aside the default judgment given that it is agreed that the motion for default judgment did not reach either defendant.

[19] The fifth factor requires the court to consider the overall integrity of the administration of justice. The integrity of the administration of justice would suffer if a party who had not been served with the statement of claim is denied the opportunity to defend himself. At the same time, integrity of the administration of justice is not necessarily preserved by permitting defendants to advance what appear to be unmeritorious defences. I am nevertheless inclined to allow the defendants to defend because my view of the merits of the defence is based on only a review of the video which reflects only part of the incident and has no audio.

[20] Although I am setting aside the default judgment, it strikes me that, in the circumstances of this case, it would be appropriate to do so in association with three conditions.

[21] First, the defendants will be jointly and severally liable for the costs the plaintiff incurred with respect to the default judgment proceedings which I fix at $19,131.14 including disbursements and HST. The defendants must reimburse the plaintiff those costs within 60 days of the release of these reasons failing which the default judgment will not be set aside. Requiring a defendant to pay the plaintiff’s costs associated with the default judgment has been found to be an appropriate condition to set aside the default judgement.[^3] The costs order is intended to take into account that the failure of effective service of the claim was ultimately Ms. Barr’s fault and also takes into account the apparent weakness of the proposed defence.

[22] Second, any writs of execution arising from the default judgment can remain in place but cannot be enforced.

[23] Third, the parties should endeavour to agree on an expedited case timetable to get this matter to a quick trial. Given the amount at issue, it would appear to be suitable for a summary trial provided it can be heard within five days. Summary trials are relatively readily available. I will make myself available for a case conference to impose an expedited timetable. Either party may contact my judicial assistant to set up a case conference for that purpose.

Koehnen J.

Released: October 26, 2022

[^1]: Peterbilt of Ontario Inc. 156527 Ontario Ltd. 2007 ONCA 333 at para 2. [^2]: The defendants moved out of the building shortly after the incident and were living in a different building when Ms. Barr was served with the statement of claim. [^3]: Brolly v. Ahwaz Autobody and Good Car, Good Price, 2007 CanLII 21592 (ON SC) at para. 55; Sugatec Construction Limited v. Greenvilla Homes (Thickson) Limited, 2022 ONSC 2036 at para. 71.