Court File and Parties
Court File No.: CV-19-00618415-0000 Date: 2023-05-23 Superior Court of Justice - Ontario
Re: LUE et al v. LOBLAWS SUPERMARKETS LIMITED et al
Before: Associate Justice D. Michael Brown
Heard: January 25, 2023 (by video conference)
Counsel: S. Guirguis for the moving parties/plaintiffs S. Robinson for the responding party/proposed defendant, United Cleaning Services Limited D. McIntyre for the responding party/proposed defendant, Orb Services
Endorsement
[1] This is a motion by the plaintiffs to amend the Statement of Claim to add two proposed defendants, United Cleaning Services Limited (“United Cleaning”) and ORB Services. The plaintiffs’ claims in the within action are for damages resulting from a slip and fall that occurred on April 22, 2017 on premises occupied by the defendants, Loblaws Supermarkets Ltd and Loblaws Inc. c.o.b as Real Canadian Superstore (“Loblaws”). It is alleged that United Cleaning and Orb Services provided cleaning services to Loblaws at the premises that contributed to the slip and fall incident. Loblaws does not oppose the motion. United Cleaning opposes the motion on the basis that the limitation period for the plaintiffs’ claims against it has expired. Orb Services has agreed not to oppose the motion on the plaintiffs’ agreement that any order granting leave to amend is without prejudice to Orb Services’ ability to plead a limitation defence. For the reasons given below, the motion is granted.
[2] The following Rules and statutory provisions are relevant on this motion:
Rule 26.01 of the Rules of Civil Procedure governs amendments to pleadings generally and provides as follows:
General Power of the Court
26.01 On motion at any stage of an action the court shall grant leave to amend a pleading on such terms as are just, unless prejudice would result that could not be compensated for by costs or an adjournment.
Subrule 5.04(2) provides specifically for the addition of parties during a proceeding:
Adding, Deleting or Substituting Parties
5.04(2) At any stage of a proceeding the court may by order add, delete or substitute a party or correct the name of a party incorrectly named, on such terms as are just, unless prejudice would result that could not be compensated for by costs or an adjournment.
Section 21(1) of the Limitations Act, 2002, S.O. 2002, c. 24, Sch. B (the “Limitations Act”) prohibits the addition of a party to a proceeding where the limitation period has expired:
Adding Party
21(1) If a limitation period in respect of a claim against a person has expired, the claim shall not be pursued by adding the person as a party to any existing proceeding.
Pursuant to s. 4 of the Limitations Act, the general limitation period (which applies to the plaintiffs’ claims in this case) expires on the second anniversary of “the day on which the claim was discovered”.
The date of discovery is determined in accordance with s. 5 of the Limitations Act:
Discovery
5 (1) A claim is discovered on the earlier of,
(a) the day on which the person with the claim first knew,
(i) that the injury, loss or damage had occurred,
(ii) that the injury, loss or damage was caused by or contributed to by an act or omission,
(iii) that the act or omission was that of the person against whom the claim is made, and
(iv) that, having regard to the nature of the injury, loss or damage, a proceeding would be an appropriate means to seek to remedy it; and
(b) the day on which a reasonable person with the abilities and in the circumstances of the person with the claim first ought to have known of the matters referred to in clause (a). 2002, c. 24, Sched. B, s. 5 (1).
[3] United Cleaning submits that the limitation period for the plaintiffs’ claims against it has expired and, as a result, the plaintiff’s requested amendments are barred by s. 21(1) of the Limitations Act. United Cleaning further argues that because of the expiry of the limitation period, amending the claim to add United Cleaning would result in prejudice to United Cleaning that could not be compensated for by costs or an adjournment.
[4] In Morrison v. Barzo, 2018 ONCA 979, the Court of Appeal outlined a two-stage approach on a motion to add a party to a proceeding after the apparent expiry of a limitation period:
The evidentiary burden on a plaintiff seeking to add a defendant to an action after the apparent expiry of a limitation period is two-fold. First, the plaintiff must overcome the presumption in s. 5(2) that he or she knew of the matters referred to in s. 5(1)(a) on the day the act or omission on which the claim is based took place, by leading evidence as to the date the claim was actually discovered (which evidence can be tested and contradicted by the proposed defendant). The presumption is displaced by the court's finding as to when the plaintiff subjectively knew he had a claim against the defendants: Mancinelli, at para. 18. To overcome the presumption, the plaintiff needs to prove only that the actual discovery of the claim was not on the date the events giving rise to the claim took place. It is therefore wrong to say that a plaintiff has an onus to show due diligence to rebut the presumption under s. 5(2): Fennell, at para. 26.
Second, the plaintiff must offer a "reasonable explanation on proper evidence" as to why the claim could not have been discovered through the exercise of reasonable diligence. The evidentiary threshold here is low, and the plaintiff's explanation should be given a "generous reading", and considered in the context of the claim: Mancinelli, at paras. 20 and 24. Morrison v. Barzo, 2018 ONCA 979, paras 31 – 32.
[5] On a motion to amend to add a party, the parties’ rights in relation to the limitation period crystalize on the date the motion is served. see Computer Enhancement Corporation v. J.C. Options et al., 2013 ONSC 4548 The plaintiffs served this motion on the defendants and the proposed defendants on October 31, 2022. Accordingly, in satisfying their onus on the test as described in Morrison, the plaintiffs must demonstrate that the claims against the proposed defendants were not actually discovered nor reasonably discoverable before October 31, 2020.
[6] With respect to the first part of the Morrison test, counsel for the plaintiffs and United Cleaning agreed in their oral submissions that the plaintiffs first acquired actual knowledge of the claim against United Cleaning on October 15, 2021 on the examination for discovery of Jericho Mercado, the discovery representative for Loblaws. The only issue in dispute on this motion is therefore whether the plaintiffs have met their onus on the second part of the Morrison test by demonstrating that the claims were not reasonably discoverable before that date.
[7] Based on the record before me, I find that the plaintiffs have provided a reasonable explanation as to why the claims against United Cleaning could not have been discovered prior to October 15, 2021 through the exercise of reasonable diligence. The fact that United Cleaning or any independent floor cleaning/maintenance contractor was engaged at the premises during the relevant period was within the knowledge of Loblaws and could only have been discovered by the plaintiffs by obtaining that information from Loblaws. Prior to October 15, 2021, Loblaws gave the plaintiffs good reason to believe that Loblaws was solely responsible for the floor maintenance and cleaning at the relevant location at the relevant time, and that no such contractor or subcontractor had been engaged. I note, in particular:
a) The incident report of the slip and fall prepared by the insurance adjuster for Loblaws on April 22, 2017, and provided to the plaintiffs in 2019, makes no mention of any floor cleaning service nor of any independent contractor or subcontractor; and
b) Loblaws’ Statement of Defence, served on October 24, 2019 and Amended Statement of Defence served on March 12, 2020 make no mention of any floor cleaning service nor of any independent contractor or subcontractor.
[8] On the evidence filed, I find that it was reasonable for the plaintiffs not to conduct due diligence into the possible involvement of any independent floor cleaning or maintenance contractor as they had no reason to believe that such contractor existed. There was no “trigger” that would have reasonably caused the plaintiffs to make such enquiries.
[9] In its factum on this motion, United Cleaning asserts that the plaintiffs “knew” that a cleaning service or contractor was “likely” involved. There is no evidence in the record before me to support a finding of any such knowledge by the plaintiffs. United Cleaning instead relies on the plaintiffs’ “retention of a personal injury lawyer and personal injury law firm” as the basis for the plaintiff’s knowledge of the “likely” involvement of a cleaning contractor, which United Cleaning argues gave rise to an obligation on the plaintiffs to conduct further enquiries.
[10] United Cleaning’s submission amounts to an argument for a free-standing obligation on plaintiffs in slip and fall cases to automatically conduct due diligence into the existence of independent contractor defendants regardless of any specific reason to believe that such a contractor exists. This court rejected such arguments in Madrid v. Ivanhoe Cambridge Inc., et al., 2010 ONSC 2235 at para 15; recently cited with approval by the Divisional Court in Ali v. City of Toronto, 2021 ONSC 5867 at paras 14 and 19.
[11] I find that the plaintiffs have satisfied their onus under the two-part test in Morrison and that the addition of United Cleaning as a defendant is not barred by the s. 21(1) of the Limitations Act. Further, as the limitation period for the plaintiffs’ claim against United Cleaning has not expired, I find that the addition of United Cleaning as a defendant will not result in any non-compensable prejudice to United Cleaning. The plaintiffs’ motion is therefore granted.
Costs
[12] As the plaintiffs were entirely successful on the motion as against United Cleaning they should have their costs. In their costs submissions, the plaintiffs sought costs on the substantial indemnity scale on the basis that before bringing the motion, the plaintiffs offered to resolve the motion with the United Cleaning on the same basis as they resolved it with Orb Services, namely, that United Cleaning would agree not oppose the motion on the agreement that the addition of United Cleaning as a defendant would be without prejudice to the United Cleaning’s ability to plead a limitation defence. In my view, the result on the motion is less favorable to United Cleaning (and more favorable to the Plaintiffs) than the plaintiffs’ offer. Accordingly, I am exercising my discretion to award substantial indemnity costs to the plaintiffs.
[13] The plaintiffs’ costs outline calculates their substantial indemnity costs of the motion at $6,183.00. In its costs outline, United Cleaning sought substantial indemnity costs, if successful, in the amount of $3,493.80. Given these amounts, the complexity of the issues and the importance of the motion to the parties, in my view substantial indemnity costs in the amount of $5,000 would be within the reasonable expectations of the parties. The plaintiffs shall have their substantial indemnity costs of the motion fixed at $5,000.
Disposition
[14] The plaintiffs’ motion is granted, with costs, as follows:
a) The plaintiffs are granted leave to add United Cleaning as a defendant to the action.
b) On an unopposed basis, the plaintiffs are granted leave to add Orb Services as a defendant to the action.
c) The plaintiffs are granted leave to amend the Amended Statement of Claim in the form of the Fresh as Amended Statement of Claim attached as Schedule “A” to the Notice of Motion.
d) The leave granted in accordance with a), b) and c), above, is without prejudice to Orb Services’ ability to plead a limitation defence.
e) United Cleaning shall pay to the plaintiffs their costs of the motion, fixed at $5,000 (inclusive of HST) and payable within 30 days.
D. Michael Brown, Associate Judge DATE: May 23, 2023