Logan Instruments Canada Corp. v Wang, 2023 ONSC 2784

Court File and Parties

COURT FILE NO.: CV-20-649655 DATE: 2023 05 08

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: LOGAN INSTRUMENTS CANADA CORP., Plaintiff - and - YICHEN WANG, Defendant

BEFORE: Associate Justice Todd Robinson

COUNSEL: J. Ren, for the defendant (moving party) J. Cecchetto, for the plaintiff

HEARD: May 8, 2023 (by videoconference)

ENDORSEMENT (Motion to Stay – Forum non conveniens)

[1] The defendant moves to set aside service of the statement of claim on him outside Ontario and for a stay of these proceedings on the basis of forum non conveniens. The defendant takes the position that British Columbia is clearly the more appropriate forum for adjudication of the dispute between the plaintiff and the defendant arising from the defendant’s alleged misuse of confidential information obtained through his employment. The plaintiff opposes the motion on the basis that the action was properly commenced and should continue in Ontario.

[2] I am unconvinced by the defendant’s arguments and am accordingly dismissing the motion.

Admissibility of supplementary affidavit

[3] At the outset of the motion, the plaintiff objected to late service and filing of a supplementary affidavit of the defendant, which was deemed served four business days ago on May 2, 2023. The affidavit was specifically characterized before me as updated evidence, rather than reply evidence. In either case, since the defendant is the moving party, the affidavit was clearly short-served pursuant to the Rules of Civil Procedure, RRO 1990, Reg 194 (the “Rules”).

[4] I am unconvinced that any of the evidence included in that affidavit was not reasonably available to the defendant when the motion materials were prepared and served. No satisfactory explanation was provided for why the affidavit could not have been and was not prepared and served at any point in over three months after the responding materials were served. Similarly, no explanation was provided for why plaintiff’s counsel was not contacted about the need for supplementary evidence with a request for consent to serve it. I do not accept as reasonable the explanation provided, namely that receiving the plaintiff’s updated costs outline led to the defendant remembering additional relevant facts that he felt should be before the court.

[5] I agree with the plaintiff that admitting last-minute supplementary evidence, to which it has no real opportunity to respond, is prejudicial and procedurally unfair. Although the defendant submits that the plaintiff did have time to respond, the plaintiff had less than 24 hours from when the affidavit was actually sent to serve any response that complied with the timelines under the Rules.

[6] This is the defendant’s motion. All evidence on which he intended to rely ought to have been included in his motion record. That is the purpose behind subrule 37.10(2), which sets out the required contents of the motion record. The original affidavit sworn November 24, 2021 is brief. It lacks any of the evidence outlined in the supplementary affidavit. To the extent that the supplementary affidavit is intended to be reply evidence (although not characterized as such), it is not proper reply. Also, all of the information and evidence relates to matters that took place between 2017 and 2019. Absent an explanation for why the evidence could not have been included in the original affidavit and why the supplementary affidavit could not have been served sooner, neither of which has been provided, I was not prepared to admit the affidavit, so I excluded it.

Request for submissions by defendant

[7] Part way through moving submissions, defendant’s counsel requested that his client be permitted to make the balance of submissions. I denied the request.

[8] The proposal to split submissions between lawyer and client was not raised at the outset of the motion hearing. Counsel had agreed to a division of time for the motion, which did not include advising me that the defendant would be making submissions himself. Accordingly, as far as I was aware, this motion was being argued solely by the two lawyers. The reporter was accordingly excused after the other matters on my list were completed. The request to split submissions should have been raised at the outset, at a time where any objections or concerns could be addressed.

[9] In addition, there was, in my view, no need or basis to have split submissions on a motion of this nature. The request to have a party make part of the motion submissions at a hearing where that party is represented by counsel is, in my view, unusual. No convincing argument for needing split submissions in this case was provided. In my view, it was thereby unnecessary and would have unduly complicated the motion hearing. A recess was granted so that coordination on further submissions could be made, after which moving submissions proceeded.

Analysis – forum non conveniens

[10] In bringing this motion, the defendant relies primarily on Churchill Cellars Ltd. v. Haider, 2018 ONSC 2013, which is put forward as a comparable case to the facts of this matter. In that decision, Master McGraw (as then titled) granted a similar motion staying an Ontario action on the basis that Nova Scotia was a more appropriate jurisdiction. Although the plaintiff argues that Churchill Cellars is distinguishable, there is no dispute that my colleague correctly set out the considerations applicable on a forum non conveniens motion.

[11] The first inquiry is whether the Ontario courts have jurisdiction over the case that may be exercised, which is known as jurisdiction simpliciter. If so, the second inquiry is whether Ontario is a convenient forum to decide the case or whether it should be decided somewhere else: Churchill, supra at para. 19.

[12] Jurisdiction simpliciter is conceded by the plaintiff, so the sole issue on this motion is whether this court should decline jurisdiction to decide the case here in Ontario. Whether to do so is a discretionary decision. The Supreme Court of Canada has held that the power to decline jurisdiction should be exercised in appropriate, but limited, circumstances in order to assure fairness to the parties and the efficient resolution of the dispute: Club Resorts Ltd. v. Van Breda, 2012 SCC 17 at para. 104.

[13] The Supreme Court of Canada has also set out that the normal state of affairs is that jurisdiction should be exercised once it is properly assumed: Club Resorts, supra at para. 109. Since jurisdiction simpliciter has been conceded, the defendant has the burden of demonstrating that British Columbia is a clearly more appropriate forum: Club Resorts, supra at paras. 103 and 109; Breeden v. Black, 2012 SCC 19 at para. 23.

[14] In assessing the defendant’s position that BC is the more appropriate forum, I must consider three main principles, which are set out in Silvestri v. Hardy, 2009 ONCA 400 at para. 7, as follows:

(1) to displace the plaintiff’s choice of forum in Ontario, the defendant must clearly establish that BC is a more appropriate forum;

(2) the balancing of the relevant factors typically used to assess the connections to each of Ontario and BC should aim to achieve the twin goals of efficiency and justice; and

(3) an aggressive approach to fact-finding should not be taken, such that if the motion cannot be decided on uncontested or agreed-upon facts, then I should accept the plaintiff’s version so long as it has a reasonable basis in the record.

[15] Relevant factors have been discussed in case law, but the list is non-exhaustive and no one factor is determinative: Club Resorts, supra at paras. 80-82 and 91-94. Having considered the parties’ arguments on forum conveniens with reference to the factors outlined in Churchill, supra at paras. 27-28, I do not disagree with the defendant that BC would be an appropriate forum. It is not, however, clearly a more appropriate forum than Ontario.

[16] In Club Resorts, supra at para. 109, the Supreme Court of Canada commented as follows:

The court should not exercise its discretion in favour of a stay solely because it finds, once all relevant concerns and factors are weighed, that comparable forums exist in other provinces or states. It is not a matter of flipping a coin. A court hearing an application for a stay of proceedings must find that a forum exists that is in a better position to dispose fairly and efficiently of the litigation.

[17] I am not convinced that the courts in BC are clearly in a better position to dispose fairly and efficiently of this litigation. In my view, most of the factors considered on these types of motions are neutral as between the parties. Without going through all of the factors in detail, I note the following:

(a) The location of the parties does not favour BC: one party is in Ontario and another is in BC. The factor is neutral.

(b) The evidence before me supports that there will likely be witnesses from both BC and Ontario, as well as multiple other jurisdictions. However, the availability of remote and hybrid proceedings is, in my view, a significant factor. Given technological advancements in courts since the onset of the pandemic, the location of witnesses and evidence is, in my view, a less significant factor that it was prior to the pandemic. Remote testimony of witnesses and use of electronic documents are now the norm in Ontario courts, not the exception. This was directly discussed by Morgan J. in Kore Meals LLC v. Freshii Development LLC, 2021 ONSC 2896, at paras. 29 and 31-32. I agree that, on this motion, Ontario and BC are similarly “on the same cyber street” and neither is more or less unfair or impractical than the other.

(c) There is a strong argument that the contract was deemed formed in Ontario: Christmas v. Fort McKay, 2014 ONSC 373 at para. 18. No contrary case law has been advanced by the defendant on this motion. I thereby agree with the plaintiff’s factum submission that the plaintiff was authorized by rule 17.02 to serve this claim in BC without leave. This favours Ontario as the appropriate jurisdiction.

(d) There is no evidence supporting that, other than the defendant working from BC, the plaintiff had any real business presence or operations in BC, which is a significant distinguishing factor from the facts of Churchill Cellars.

(e) Although argued by the defendant, there is no credible evidence supporting that the defendant’s knowledge of BC law is a relevant factor. No cogent argument was made that the law governing the employment contract is in any way dependent on where an action is commenced or proceeds. The defendant has not indicated any intention to self-represent. There is also no evidence that he will be unable to find capable Ontario or BC counsel to represent him, regardless of where the dispute proceeds. As pointed out in the plaintiff’s factum, the National Mobility Agreement permits reciprocating practice of Canadian lawyers in different provinces.

[18] Several of the relevant factors favour Ontario. In my view, none of them clearly favour BC. There is simply insufficient evidence to find that BC is a clearly more appropriate forum than Ontario. I thereby find that the plaintiff is entitled to its selected forum in Ontario.

[19] I would add that, although I did not admit the defendant’s supplementary affidavit, had I admitted it, doing so would not have changed my view or the result.

[20] For these reasons, I am dismissing the defendant’s motion.

Costs

[21] The plaintiff has been entirely successful in this motion and, in my view, is entitled to its costs. The plaintiff seeks substantial indemnity costs of $25,253.24, including HST and disbursements (which does not include additional time in court today above the estimated 2-hour appearance or time spent dealing with the supplementary affidavit). Alternatively, the plaintiff seeks partial indemnity costs of $19,666.52 including HST and disbursements. The defendant submits that partial indemnity is the appropriate scale and that costs should not exceed $10,000.

[22] This motion was evidently important to the plaintiff, who fought for its forum choice. Had it been unsuccessful, the ability to pursue the claim in BC may have been challengeable on a number of grounds, including potential limitations defences given the passage of time while this motion was pending. I also agree with the submission that the motion was of moderate complexity, despite the staunch positions of the parties. That said, the materials involved multiple cases and disputed interpretations of their application to the facts.

[23] The partial indemnity amounts claimed by both parties are within approx. $2,000. I thereby do not accept the submission that costs should be capped at $10,000. Reasonable expectations are always a factor. It is difficult to reconcile a costs outline supporting a claim of $17,763.60 in costs by the defendant with his position that the plaintiff should be limited to only $10,000. In my view, the partial indemnity claim by the plaintiff is within the reasonable expectations of the defendant in the circumstances of this case.

[24] I agree with the defendant’s submission that he is not truly responsible for the delay in this motion being heard. It does appear that that the court, on its own initiative, adjourned the first CPC attendance and the January hearing was adjourned to an associate judge through no fault of either party. Neither had considered that this motion was properly within the jurisdiction of an associate judge and it was not apparently flagged at the Civil Practice Court attendances or on the case conference. I do not view the defendant’s conduct in this motion opposing jurisdiction as unduly delaying the hearing of the motion.

[25] However, I find the letter dated December 17, 2021, sent by plaintiff’s counsel to defendant’s counsel, to be relevant to the scale of costs. That letter proposed that the plaintiff would accept a withdrawal of the motion on payment of the plaintiff’s partial indemnity costs. It included reference to the same case law that I have relied upon, in part, in dismissing this motion and contemplated the result I have reached. In my view, it was an offer capable of being accepted, but was not accepted. The offer was made prior to an upcoming Civil Practice Court attendance and prior to the plaintiff serving its responding motion materials. It is not a formal rule 49 offer to settle, as conceded by the plaintiff. However, rule 49.13 expressly provides that, in exercising my discretion with respect to costs, I may take into account any offer to settle made in writing, the date the offer was made, and the terms of the offer.

[26] In my view, substantively all of the plaintiff’s costs of this motion would have been avoided had the offer been accepted and the motion withdrawn. The defendant may have felt that he had legitimate bases to dispute the forum, but he has been entirely unsuccessful. In my view, the offer is properly considered and supports heightened costs.

[27] That said, I do not view the adjournment of the January appearance to be the fault of either party, as already discussed. That is a mitigating factor. Otherwise, no particular challenge has been raised with the hours spent or rates claimed on behalf of the plaintiff.

[28] Having weighed the factors in rule 57.01, the impact of the offer to settle, and the considerations outlined in prevailing case law such as Boucher v. Public Accountants Council for the Province of Ontario (2004), 71 OR (3d) 291 (CA) and Davies v. Clarington (Municipality), 2009 ONCA 722, I am awarding substantial indemnity costs of this motion fixed in the amount of $22,500, inclusive of HST and disbursements, payable with thirty (30) days. Order accordingly.

ASSOCIATE JUSTICE TODD ROBINSON DATE: May 8, 2023