MCAP Service Corp. v. Sivabalan, 2023 ONSC 1278

Court File and Parties

COURT FILE NO.: CV-15-851-0000 DATE: 2023-02-22 SUPERIOR COURT OF JUSTICE - ONTARIO

RE: MCAP Service Corporation, Plaintiff AND: Sasitha Sivabalan, Defendant

BEFORE: Kurz J.

COUNSEL: Matthew Sack and David Heppenstall, for the Plaintiff

HEARD: February 14, 2023, in chambers

Endorsement

Introduction

1This is a motion in writing to “renew” a writ of seizure and sale which expired on May 27, 2021. As I set out below, there is no jurisdiction to “renew” an expired writ of seizure and sale. Rather, this is properly a motion for the issuance of a fresh writ of seizure and sale more than six years after the underlying judgment was granted.

2While this motion was made on notice, with service by mail to the Defendant, it was not accompanied by evidence that the address at which service was affected is that of the Defendant. That is relevant because this motion is brought about eight years after the Plaintiff first sued the Defendant. There is no evidence before me that the Plaintiff made any effort to determine whether the address at which it served the Defendant is his current address.

3As set out below, I also have serious concerns with the quality of evidence offered in this motion. I observe that the problems raised in this endorsement frequently arise in written motions for common relief in civil matters, such as substituted service, writs of possession and “renewal” of expired writs.

4For the reasons set out below, I dismiss this motion with leave to bring it again on better materials.

Test for Issuance of a Writ More Than Six Years After Judgment

5There is no provision in the Rules of Civil Procedure for the “renewal” of an expired writ of seizure and sale. Rather, under Rule 60.07(2) a fresh writ can be issued upon leave if six or more years have elapsed from the date of the original order. In such a motion, as the Court of Appeal for Ontario stated in Achtem v. Boese, 2021 ONCA 284, “it would be a rare case where the party seeking leave is unable to meet the test by sufficiently explaining the delay” (citing Adelaide Capital Corp. v. 412259 Ontario Ltd., [2006] O.J. No. 4175 at para. 13).

6In Adelaide Capital, Master Dash adopted for writs of seizure and sale, the evidentiary threshold for the issuance of a notice of garnishment more than six years after a judgment. Master Dash set out that test in Royal Bank of Canada v. Correia, [2006] O.J. No. 1238 (S.C.J.) at para. 10. There he said that the plaintiff seeking leave “must adduce evidence explaining the delay such [that] the court may conclude that the plaintiff has not waived its rights under the judgment or otherwise acquiesced in non-payment of the judgment.”

7In such a motion, the defendant is at liberty to “raise other grounds to convince the court that it would be inequitable to enforce the claim”. As Master Dash wrote at para. 13 of Adelaide Capital, “[i]f the plaintiff meets the test the onus is then on the judgment debtor to convince the court that ‘he has relied to his detriment or changed his financial position in reliance on reasonably perceived acquiescence resulting from the delay’”.

Evidentiary Concerns with the Motion Materials

8This is the second time that this motion is before the court. The original motion materials relied on the affidavit of an articling student with no personal knowledge of the events to which she deposed. Nonetheless, she opined that ongoing collection efforts had been made during an unspecified period of time. That being said, the student failed to offer the source of the information and opinions she offers. That was likely not her fault but rather that of her principals, who drafted or supervised the drafting of her affidavit.

9In reviewing the first set of motion materials, Coats J. wrote that “[t]he deponent of the Affidavit must clarify the source of the information at para. 6-16 of the Affidavit and provide an explanation for the delay.”

10This motion has now been placed before me. A second affidavit has now been produced, this time by a law clerk. There is no affidavit of service of the law clerk’s affidavit on the Defendant. Once again, the law clerk professes no knowledge of the events in question. Instead, she relies on the information of an employee of Teranet (the “employee”), whom the deponent says “advises” the law firm. Why the employee cannot swear her own affidavit is left unsaid.

11The law clerk goes on to say that the information in the articling student’s original affidavit “is based on information from [the employee]”. How the law clerk knows this, she fails to say.

12The law clerk continues, providing evidence based on information provided by the employee. She deposes that “the plaintiff’s simple inadvertence to renew the writ prior its expiry is the result of a convergence of factors – with no one element solely responsible – including both human error and systemic issues; each of which Teranet is taking steps to correct going forward.” The employee advised that the matter was not properly diarized, and that Teranet was not aware that the writ had expired. She also says that the disruption caused by the pandemic was “at least a factor” in being unaware of the expiry of the writ. How that was the case was not set out.

13The law clerk continues, stating that Teranet had made ongoing collection efforts on behalf of the plaintiff “including inter alia obtaining periodic credit bureau reports to ascertain current address and employment information with respect to the defendant and that the plaintiff has neither acquiesced to the defendant’s non-payment nor waived its rights of enforcement.”

14This bit of information and belief fails to offer any particulars regarding the frequency of obtaining credit bureau reports, which seem to be the only manner in which the Plaintiff took any steps to enforce its writ. There is no evidence that the employee ever directly contacted the Plaintiff bank, in order to offer its double hearsay evidence of its want of acquiescence to nonpayment. The employee appears from the evidence to be only working for an agent of the plaintiff’s law firm and thus stands two steps removed from the Plaintiff bank.

Law Regarding Affidavit Materials in Motions

15In Haventree Bank v. Lording, 2023 ONSC 1077, I dealt with the adequacy of materials in a motion such as this, I wrote:

4Many litigants and counsel believe that evidentiary rules in written motions are so lax that virtually anything goes. That is not the case. The presumptive rule regarding affidavits, limiting evidence to facts that an affiant could testify to at trial, is set in Rule 4.06(2) of the Rules of Civil Procedure, R.R.O. 1990, Regulation 194, which states:

(2) An affidavit shall be confined to the statement of facts within the personal knowledge of the deponent or to other evidence that the deponent could give if testifying as a witness in court, except where these rules provide otherwise.

5Rule 39.01(4) sets out a limited exception to that rule for affidavits in a motion. It allows hearsay in such affidavits if certain conditions are met. It states:

(4) An affidavit for use on a motion may contain statements of the deponent’s information and belief, if the source of the information and the fact of the belief are specified in the affidavit.

6The permissiveness of this subrule does not offer parties and counsel a licence for sloppiness, laxity or the admission of double or triple hearsay, as the Bank attempts to do here.

7In Gutierrez v. The Watchtower Bible and Tract Society of Canada, 2019 ONSC 3069, Perell J. wrote at para. 27:

… the Rules of Civil Procedure permit hearsay evidence for motions. An affidavit for use on a motion may contain statements of the deponent's information and belief, if the source of the information and the fact of the belief are specified in the affidavit. A statement in an affidavit that: (a) does not state the source of the affiant's information; or (b) contains inadmissible hearsay, legal and factual argument belonging in the factum, inflammatory rhetoric, or offensive allegations made for the purposes of prejudicing another party may be struck out in whole or in part.

8A court is not bound to accept unopposed and/or uncontradicted affidavit evidence if it fails to persuade. As Master Sandler wrote in Hrivnak v. Steel Art Co. (1989), 34 C.P.C. (2d) 34 (Ont. Master), at para. 27, the court is required “to scrutinize [the deponent’s] evidence carefully and see how it fits in with other evidence and with inferences that can fairly be drawn from the absence of other evidence, and if his evidence does not seem persuasive or consistent, [it] can refuse to accept it.”

9…

10At para. 19 of Peirson, Corbett J. cited two older cases decided by Masters, relying on the best evidence rule to reject hearsay knowledge and belief affidavits. he wrote:

[In] Wiley, Lowe & Co. v. Gould, [1958] O.W.N. 316 (H.C.J.) … the appeal from an order of the senior master was dismissed. The senior master refused an application to set aside an ex parte order for substituted service of a writ of summons. The master refused to admit the four affidavits filed in support of the motion by three solicitors and a student which contained hearsay upon hearsay. No reason was given for not filing an affidavit by the defendant. The master relied on the principle stated in Dixon v. Gibson (1931), 40 O.W.N. 60 (Master's Ch.) that it was discretionary under the applicable rule to receive affidavits on information and belief, and concluded that the best evidence rule should be insisted upon.

Analysis

11Despite the low bar and two opportunities to overcome it, the Plaintiff offers evidence whose quality is so weak and vague that the court cannot find that the modest Adelaide Capital test has been met. Further, I have concern with two service issues. First, the law clerk’s affidavit was not served on the Defendant. Second, the original motion record was mailed to the Defendant at an address which the Plaintiff fails to demonstrate is a proper address for service on the Defendant. The address at which the Defendant was originally served with the statement of claim, likely about eight years ago, may no longer be the proper address for service.

12As I pointed out in Haventree Bank v. Lording, courts are frequently faced with written motions like this. Responding materials are rarely filed. There appears to be an expectation that the relief sought in these motions will be summarily granted. But judges should not be treated as if they were rubber stamps. Judges reviewing these motions spend far too much time wondering whether the weak evidence provided to them is sufficient to barely exceed the relevant evidentiary bar. Often the decision is a difficult one. Judges should not be placed in that position.

13Counsel for institutional financial corporations, who bring these motions on a routine basis, are well able to prepare proper materials. They must be willing and if necessary, instructed to take greater care in the preparation of their materials for written motions.

Conclusion

14Motion dismissed without prejudice to the right to bring such a motion for leave again, based on better evidence and better service. In such a motion the Plaintiff must demonstrate that the Defendant is being served at a current address and this endorsement must be included in that service. I am not seized of any further motion.